Anchor, a banking-as-a-service (BaaS) platform has launched its public beta Application Programming Interface (API) infrastructure to make it easier for African businesses to build, embed, and establish financial products, starting its first market in Nigeria.
The company stated that the platform’s public beta API infrastructure will enable African businesses to embed finance into their offerings and enable fintech to build banking products.
Founded by Segun Adeyemi, ex-CEO of Amplifypay, Olamide Sobowale, and Gbekeloluwa Olufotebi, Anchor provides API for offering accounts, money movement, savings, and card products.
“We built Anchor to abstract away the complexities in building financial products, so businesses can get started in five minutes with a few lines of code”, says Segun Adeyemi. CEO of Anchor.
In May, Anchor released its private beta working with innovative start-ups like OutpostHealth, Dillali, and Pivo, the BaaS platform has transacted millions, growing over 200 percent month-on-month, with more than 40 other startups on its waitlist.
The startup which was accepted into Y Combinator Summer 2022 Batch as the first African BaaS and embedded finance platform has raised over $1 million in pre-seed funding from Byld Ventures, Y Combinator, Luno Expeditions, Niche Capital, Mountain Peak Capital.
With a host of angel investors including Emmanuel Okeleji (CEO, SeamlessHR), Ado Oseragbaje, Yinka Odeleye, and Sanmi Famuyide.
Ashutosh Desai, a Partner at Y Combinator, says, “Anchor’s embedded finance platform enables technology companies in Africa to build products that can rapidly expand access and improve the quality of financial services.”
“We’re excited to back Segun, Olamide, and Gbeke – a highly technical and experienced team – in building financial infrastructure that’s essential for Africa’s economic growth,” Desai said.
However, In recent years, there have been several reports about the size of the Africa financial inclusion opportunity, particularly in reference to the provision of digital financial services.
These reports have brought about a spike in the number of companies and amount of investment activities in the fintech space in Africa. Yet, two things stand out; the minimal impact on financial inclusion, and the persisting difficulty in building and launching a fintech company on the continent.
Similarly, financial exclusion in Nigeria decreased by only one percent, from 37 percent in 2018 to 36 percent in 2020. Also, across Africa, it takes an average of $500,000 and 18 months to build and go to market with financial products.
This is because companies need to go through the hurdles of rigorous licensing and compliance processes, multiple integration layers, complex banking and third-party relationships, and invest in complicated core-banking infrastructure, the company stated.
Youcef Oudjidane, founder of Byld Ventures, stated, “I believe BaaS will play a prominent role in the distribution of financial services in Africa. As a full stack BaaS provider, Anchor demarcates customer engagement from infrastructure – enabling its customers to focus on building differentiation as opposed to commodity infrastructure.”
“We are really excited to be working with this determined and experienced team”, Oudjidane said.