Kuda to expand banking service in UK to Nigeria’s in diaspora

Kuda, the London-based and Nigerian-operating startup is expanding its service to the U.K. by offering a remittance product to Nigerians in the diaspora.

Launched in Nigeria in 2019. Kuda claims to have up to 5 million users, more than thrice the number it had last August during its $55 million Series B round, money it raised to enter into other African countries like Ghana and Uganda this year. Expansion into those countries is yet to materialise; instead, Kuda has opted to launch in the U.K., a move the company says is part of a major global expansion drive.

“I don’t necessarily think it’s crowded because obviously, there are still a lot of challenges in remitting money to Africa, especially to Nigeria, which is still expensive,” said Babs Ogundeyi, chief executive officer at Kuda.

Kuda is adopting a different approach that doesn’t involve charging transaction fees. The fintech says it’s entering the U.K. market by setting a flat fee of £3 with a transfer limit of £10,000. Kuda expects most of the transactions that will take place on its platform to fall between £350 to £500, Ogundeyi noted.

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In addition to remittance, Kuda intends to provide direct debits and local transfers to Nigerians in the U.K. down the line. The plan suggests that the Nigerian-born fintech, having raised more than $90 million from investors such as Peter Thiel’s Valar Ventures and Target Global, thinks it has enough firepower to take a small piece of other neobanks’ cakes, such as Revolut, Monzo and Wise.

However,these platforms have built sticky features that have yielded strong adoption across various demographics in the U.K., including migrants like Nigerians, the niche population Kuda is targeting with its launch.

“Ultimately, Kuda is building a one-stop shop for Africans, including other services outside remittance. And our plan is not just for Africa, but for Africans everywhere,” said Ogundeyi of the expansion. “The U.K. is the first of the ‘outside of Africa’ destinations. We plan to be in other African countries and expand the remittance services to customers there and the diaspora market.”