Djamo is one in every of a number of digital banking startups concentrating on Africa’s underbanked. But not like many that target massive markets like Nigeria, Egypt, or South Africa, Djamo has carved out a distinct segment in Francophone West Africa, particularly the Ivory Coast and, extra not too long ago, Senegal. It now serves over a million prospects throughout each international locations.
The Y Combinator-backed fintech simply raised $17 million to broaden its product suite for these retail prospects and the 1000’s of small companies it has onboarded within the final two years.
The fairness spherical, the most important ever for an Ivorian startup, surpasses Djamo’s $14 million Series A in 2022 and displays continued investor confidence in its mission to make banking accessible and inexpensive.
Co-founder and CEO Hassan Bourgi declined to share the brand new valuation however stated it has doubled for the reason that final elevate.
Bourgi based Djamo with chief product and technical officer Régis Bamba in 2020 to shut the monetary entry hole in French-speaking African international locations, the place few adults have financial institution accounts. Traditional banks within the area typically cater to the prosperous, leaving many of the inhabitants reliant on cellular cash, a less expensive methodology that features utilizing telephone numbers to make monetary transactions.
Mobile cash has been instrumental in increasing monetary entry throughout Africa. As of 2022, 28% of adults in Sub-Saharan Africa had a cellular cash account, per the World Bank, and the area holds greater than half of the world’s complete. But that progress has additionally created a ceiling.
Most cellular cash platforms supply primary companies: cash-in, cash-out, P2P transfers, and invoice funds. While helpful, they don’t unlock extra superior monetary instruments like credit score, investments, or long-term financial savings.
Djamo is positioning itself between cellular cash and conventional banking. The startup presents the accessibility of cellular cash with the monetary depth of a checking account, the same playbook that Softbank-backed OPay and Transsion-owned PalmPay have used to scale to tens of hundreds of thousands of shoppers in Nigeria.
Its goal is a rising section of customers, principally youthful prospects, who’ve outgrown cellular cash wallets however nonetheless discover conventional banks costly, outdated, or inaccessible, the founders say.
“These customers are evolving,” stated Bourgi. “But they don’t wish to go the place their mother and father went, into establishments with predatory pricing and aren’t tailored to the brand new era of shoppers. And that is what we’re constructing, making an attempt to develop into the go-to financial institution for this enormous cohort of shoppers that’s evolving now to extra complicated, wealth-building financing alternatives.”
Expanding product suite to swimsuit demand
Since our final protection, Djamo has expanded past playing cards and peer-to-peer transfers. The Ivorian fintech now presents financial savings vaults, funding merchandise — because of the area’s first fintech-issued brokerage license — and salary-linked financial institution accounts, which Bourgi sees as necessary to boosting buyer engagement.
Like many neobanks, Djamo attracts banked customers who deal with it as a secondary account for smoother invoice funds and cellular cash integration. But it’s the unbanked, harder to activate, who present better long-term potential. These customers, who make up over 55% of Djamo’s base, typically deal with the app as their major monetary service.
Bourgi says 9 in ten customers who depend on Djamo as their predominant account come from this section. To attain extra of them, Djamo has adopted a hybrid strategy, combining its app with offline brokers who meet prospects in particular person to facilitate transactions, much like the cellular cash mannequin now extra broadly adopted by fintechs throughout the continent.
Currently, solely 5–10% of Djamo customers obtain salaries via the app. “The subsequent part for us,” Bourgi stated, “is determining how one can transfer from 10% to 50% of our customers getting their salaries paid straight into Djamo.”
Meanwhile, Djamo can be ramping up companies for small companies—about 10,000 of them, a lot of whom began as retail customers. According to CTO Bamba, the startup now offers bulk funds, cost hyperlinks, and QR code instruments to assist retailers settle for and handle funds straight inside the app.
The fintech generates income from service provider charges on on-line card purchases and a premium tier plan, which 25% of customers pay for. Bamba provides that the corporate is exploring extra income streams, together with lending and incomes curiosity on buyer deposits. It is within the strategy of securing licenses that may enable it to supply interest-bearing financial savings accounts and credit score merchandise.
Djamo’s founders say the corporate has grown income 5x since 2022 and processed greater than $4.5 billion in transactions since launch.
With its latest growth into Senegal, Djamo has entered a market dominated by Wave, one in every of Africa’s largest fintechs recognized for low-cost cellular cash transfers. But somewhat than compete straight, Djamo positions itself as a complementary service, providing a digital banking expertise the place customers can retailer funds and entry extra superior instruments like financial savings, investments, and credit score.
Now a 250-person staff, Djamo is betting that its new spherical of funding, led by pan-African, gender-focused VC Janngo Capital, will assist it scale these companies throughout French-speaking Africa.
“We are thrilled to steer the most important VC spherical in Ivory Coast and double down on Djamo, a mission-driven fintech remodeling entry to monetary companies throughout Francophone West Africa,” stated Fatoumata Bâ, founder and govt chair of Janngo Capital.
“In a area the place fewer than 25% of adults have entry to formal monetary companies, and the place girls are twice as prone to be excluded, this can be a important mission. With girls making up a 3rd of its customers, Djamo just isn’t solely closing the gender hole however unlocking financial alternative at scale.”
Other buyers taking part within the spherical embody SANAD Fund for MSMEs (managed by Finance in Motion), Partech, Oikocredit, Enza Capital, and Y Combinator.
