Flutterwave, Africa’s payment-focused fintech has made public its acquisition of payment licences for 13 states in the US. Experts say this is part of the company’s strategies to dominate the remittance market in Africa.
Remittance from Africans living in the diaspora, including the United States, has grown significantly in recent years. Data from FXC Intelligence show that the value of remittances to Africa increased from $31 billion in 2010 to $43.8 billion by 2022. Nigeria is among the top remittance recipients globally, with $19.3 billion in 2022. The growth of the market has since attracted investments from players, including banks and financial institutions who are expanding their business operations to cover the market.
Flutterwave, which has already processed over 550 million transactions totaling more than $32 billion and served over two million businesses, has extensive infrastructure across 34 African countries. The new licences, therefore, give the company an expanded reach, particularly in a key market – the United States of America. The company is also planning to become a publicly listed company on the New York Stock Exchange (NYSE).
“They are looking to list very soon; so, they are trying to create an exit liquidity event for their shareholders. One way to do that would be to continue to show the value they are creating by getting more market share,” said a source who wants to remain anonymous to speak freely.
The acquired licences grant Flutterwave permission to operate in Arizona, Arkansas, Maryland, Michigan, Delaware, Georgia, Maine, Mississippi, Missouri, New Hampshire, Iowa, North Dakota, and South Dakota. Alongside an existing partnership with a licensed financial institution, the company is now able to serve customers in 29 states in the U.S.
Read also: Flutterwave tells customers, ‘We are open for business’
The company now boasts of international payment processing in 150 currencies with multiple payment modes, including local and international cards, mobile wallets, and bank transfers. Its infrastructure spans over 34 African countries, including Nigeria, Uganda, Kenya, and South Africa, the fintech giant is out to dominate the industry.
The company’s portfolio includes international payment processing capabilities in 150 currencies, supporting various payment modes such as local and international cards, mobile wallets, and bank transfers.
According to a statement by the company, money transfer licences are issued by state regulators to allow financial technology companies to engage in the transmission of money.
“These licences enable Flutterwave’s solutions like Send App, which facilitates money transfer between the U.S. and Africa, and enterprises that use Flutterwave for last-mile payout globally,” it said.
This acquisition also brings the startup a step closer to completing its initial public offering (IPO) ambition as reported by BusinessDay in August.
Olugbenga Agboola, CEO/co-founder of Flutterwave, had said in an interview with Bloomberg, “There’s some kind of customers we’ll attract when we are public. The large global clients need you to have the same level of compliance and level of global view that they have.”
Read also: Flutterwave IPO hunt ignites review of listed African pioneers
“Getting these licences expands our regulatory footprint, demonstrates our ability to deliver services with safety and soundness, and fosters the trust of regulators, partners and customers,” said Stephen Cheng, executive vice president, global expansion and partnerships at Flutterwave.
“We’re growing and are committed to servicing customer needs in as many geographies as possible with a significant African diaspora. These licences reflect our commitment to working with regulators across various markets, following their requirements and ensuring the safety of customer funds. We will continue to create an environment of safety and trust,” added Cheng.
Flutterwave had also announced earlier in August that it had extended its remittance solution Send App to Canada and the U.S.
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