Over the previous decade, Dubai-based Network International has turn into one of many dominant fee processors throughout the Middle East and Africa, thanks partially to a pair of acquisitions.
However, many massive incumbents can fall prey to slower innovation, opening the door for smaller, faster-moving startups. The newest growth is Enza, a fintech based in 2022 by Hany Fekry, a former managing director at Network, together with one other ex-Network government Hamish Houston.
The fintech, which has raised $6 million in seed funding, is constructing infrastructure for banks and fintechs, providing a spread of native fee options, from playing cards to wallets to real-time funds.
Before launching Enza, the founders managed international acceptance, processing, and shopper finance departments at Network International. While Network was constructing a sturdy funds community throughout the Middle East and Africa, focusing totally on the acceptance facet of issues, they felt an enormous hole in creating complete options for banks and fintechs, particularly in Africa.
When neither get together may discover an alignment with Network, they resigned to start out Enza, which formally launched in January 2023.
“Our divergence prompted us to take a step again and rethink how you can deal with these underserved wants out there,” CEO Fekry informed TechCrunch.
The founders of Enza say they’ve constructed the corporate utilizing classes from their time at Network International and its subsidiary, DPO Group. But not like these companies, which centered largely on card acceptance and service provider buying, Enza is taking a broader strategy, serving either side of the transaction.
Enza’s platform is designed for banks and fintechs on the issuing facet, and SMEs and retailers on the acceptance facet. The startup is initially focusing on Egypt, Nigeria, and South Africa, three of the continent’s largest monetary markets.
Payments acceptance into broader fintech scale
Payments are sometimes the primary entry level into formal finance for the tens of millions of underserved or unbanked small companies throughout Africa. Enza needs to assist these companies settle for in-person and on-line funds at little to no value — a technique it thinks will enable banks and fintechs to construct long-term relationships.
Once these are in place, Enza’s infrastructure allows cross-selling of lending, financial savings, insurance coverage, and different monetary companies.
“Payments are the gateway,” says Andrew Key, who joined Enza as an government director final yr. “But the worth is within the knowledge and the companies you possibly can layer on high.”
That technique additionally performs to the altering dynamics between banks and fintechs in Africa. For years, banks have ceded infrastructure and significantly SME market share to gamers like Flutterwave, Fawry, Paymob, and Moniepoint, now Nigeria’s largest service provider acquirer. But banks nonetheless maintain key benefits, particularly broader service choices and regulatory backing.
“Banks have realized they gave up an excessive amount of floor to fintechs,” Houston stated. “We wish to give them the tech to compete and win it again.”
Similarly, regardless of the rise of fintechs throughout Africa, banks stay the central, regulated gamers behind most fee aggregators. But many nonetheless lack clear visibility into what their aggregator companions or downstream retailers are doing.
That’s considered one of Enza’s functionalities, the founders say: Giving banks extra transparency and management over their fee ecosystems to allow them to keep compliant whereas scaling.
The Dubai-based startup additionally broadens the fee choices obtainable to banks. Enza integrates with native card schemes like Verve, AfriGo, and Meeza, alongside international networks like Visa and Mastercard.
It additionally connects with real-time fee infrastructure, together with Nigeria’s NIBSS, South Africa’s PayShap, and Egypt’s InstaPay, in addition to cell cash and telco wallets, whereas supporting QR codes, buy-now-pay-later (BNPL), and contactless funds options.
Leveraging founders’ networks
Enza is leveraging its founders’ many years of expertise and deep relationships throughout the continent to shortly safe contracts with a number of banks. For occasion, Fekry beforehand served as chief business officer at Emerging Markets Payments (EMP), which was acquired by Network International, the place he later grew to become a managing director.
Across their careers, the crew has labored with practically 200 banks. But this time, they’re going for high quality over amount. “We’re not making an attempt to duplicate that scale,” Houston stated. “We’re focusing on 30 to 40 high-quality financial institution relationships.”
While the corporate solely started operations final yr, the Dubai-based fintech has already secured over 10 million month-to-month contracted transactions by way of reside financial institution partnerships throughout six African markets, Rwanda, Nigeria, Ghana, Egypt, Uganda, and South Africa.
Enza expenses banks on a per-transaction (“per-click”) foundation. Those volumes are rising 35 to 40% month-over-month and are anticipated to double within the subsequent two years.
The firm bootstrapped in its early years, with the founders funding it themselves. When they determined to boost outdoors capital, the founders stated they didn’t store the deal broadly.
Instead, Algebra Ventures and Quona Capital led the $6 million seed spherical. “The Enza management crew has a formidable observe report of beginning, rising, and exiting fintech companies throughout the continent,” stated Tarek Assaad, managing accomplice at Algebra Ventures, on why his agency backed the two-year-old fintech.
The new capital will go towards increasing the crew and rolling out new merchandise for its banking clientele throughout Africa.
“We based Enza to unravel actual infrastructure issues throughout Africa,” Fekry stated. “We’ve spent our careers making an attempt to verify our households and communities can entry monetary merchandise as folks in Europe or the U.S. at a low value and anytime they need.”
