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FinTech

Kuda secures licenses in Tanzania and Canada

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Nigerian digital bank Kuda has secured payment licenses in both Canada and Tanzania, allowing it to offer remittance and multi-currency wallet services.

The first license will allow the digital bank to offer remittance and multi-currency wallet services to Africans living in Canada.

The second is a Tanzanian Payment Service Provider (PSP) license that will offer similar services to Kuda's Tanzanian customers.

The licenses are part of the neobank's expansion plans across Africa and globally. A neobank is a fintech company that offers direct banking services to individuals and organizations, with no traditional physical branches.

In 2022, Kuda secured a payment license in the United Kingdom and rolled out a subscription-based remittance offering. However, according to media reports, it has discontinued its UK remittance services.

Kuda spreading its remittance wings

The digital bank was launched in 2019 and since then has made over US$35 billion in transactions while serving over five million customers, according to TechCabal.

Furthermore, in August 2021 the company closed a $55 million Series B round at a $500 million valuation.

As it stands, the company currently seems to be catering to the financial needs of Africans living abroad, focusing on countries with large African populations like the UK and Canada. It also acquired another digital banking license in Pakistan in 2023.

Kuda's first license will allow it to offer remittance and multi-currency wallet services to Africans living in Canada, while the second is a PSP license that will offer similar services to its customers in Tanzania.   (Source: Image by wayhomestudio on Freepik)
Kuda's first license will allow it to offer remittance and multi-currency wallet services to Africans living in Canada, while the second is a PSP license that will offer similar services to its customers in Tanzania.
(Source: Image by wayhomestudio on Freepik)

With the license in Tanzania, the company will now have a presence in two African countries and will compete with startups like Nala and Lemfi, which offer financial services to Africans abroad.

African remittance revolution

Kuda's securing of the licenses comes as a number of companies are targeting the cross-border payment market in Africa.

In June 2023, cross-border payment solution LemFi announced a service expansion into Kenya.

Swiss fintech company Centi announced a partnership with global digital cash wallet Centbee to use blockchain technology to facilitate remittance services between Switzerland and Africa in May 2023.

Tanzanian payments company Nala was granted a PSP license to operate in the East African country in March 2023.


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Other companies are also expanding in Africa, like money remittance and gifting solution Sendsprint, which offers a $5 flat fee for all transfers rather than the usual percentage-based model.

Ugandan fintech app Eversend also offers money transfers for Africans in the diaspora and South African fintech company Mama Money expanded its cross-border money transfer and banking services to Malawi and Zimbabwe in February 2023.

Related posts:

*Top image is of Kuda CEO Babs Ogundeyi. (Source: Kuda.)

Matshepo Sehloho, Associate Editor, Connecting Africa

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