PalmPay, an African digital bank fintech, is in talks to raise between $50 million and $100 million in a Series B round, according to multiple sources familiar with the matter.
It’s unclear what valuation it hopes to get, but its last round, in 2021, ranked it among the continent’s most valuable startups, estimated just shy of unicorn status.
While PalmPay declined to comment on fundraising specifics, a spokesperson said the six-year-old fintech is “in a strong financial position and exploring growth opportunities.”
The company, which has raised nearly $140 million across its seed and Series A rounds, is now profitable, according to people familiar with its finances.
The new capital, expected to include both equity and debt, will fuel PalmPay’s expansion: deepening its footprint in Nigeria, scaling its newer business-focused offering, and rolling out both products in new markets across Africa and Asia.
Last month, PalmPay announced it had hit 15 million daily transactions, driven by its 35 million registered users. These transactions now add up to “tens of billions of dollars” annually in value, according to the company.
Revenue has also surged. PalmPay’s revenue — $64 million in 2023, according to the Financial Times — has more than doubled since, people familiar with the company’s financials say.
Launched in 2019, PalmPay started out in Nigeria, Africa’s most populous country and a major fintech hub. At the time, over half of adults in the country were unbanked, and traditional banks catered mostly to salaried or formal-sector clients, often with requirements that excluded mass-market users.
PalmPay saw an opportunity to flip that model on its head: build a digital bank from scratch, but optimize it for the realities of Africa’s informal economy. The company launched an app featuring instant onboarding, zero transfer fees, and a growing suite of services (including credit, savings, insurance, and bill payments) all tailored to the needs of underbanked consumers and small businesses.
Crucially, PalmPay didn’t rely solely on digital acquisition. The fintech built a vast on-the-ground network of over 1 million small businesses and agent merchants, who now serve more than 10 million customers monthly through the PalmPay Business app and point-of-sale devices (for cash-in, cash-out services).
Other major fintechs in the country, including OPay, Moniepoint, and Paga, have also adopted the hybrid model, combining digital apps with physical touchpoints.
PalmPay claims to process more transactions than any traditional bank in Nigeria, and 25% of its users report that it was their first-ever financial account. For credit products, offered in partnership with licensed lenders, that number jumps to 60% among borrowers, it claims.
Part of PalmPay’s strong distribution and marketing advantage stems from its partnership with Transsion, the Chinese phone maker that dominates smartphone sales in Africa, with a market share of over 40% across its brands (Tecno and Infinix).
Through the partnership, PalmPay pre-installs its app on select financed smartphones, helping drive user acquisition and engagement.
Having established itself as one of the most widely used fintech apps in the country, PalmPay is now preparing to replicate its model in new markets abroad.
The neobanking platform has expanded to Tanzania and Bangladesh (its first foray outside Africa), where PalmPay is entering with device financing and consumer credit as wedges before layering in more services. (Other African digital banks, including FairMoney, MNT-Halan and TymeBank, have expanded their financial services into Asia with varying degrees of success.)
The company also plans to introduce device financing in Nigeria, its spokesperson confirmed.
While Transsion, which led PalmPay’s seed round, remains a strategic partner, the company’s spokesperson says the fintech is actively exploring collaborations with more original equipment manufacturers (OEMs).
GIC (Singapore’s sovereign wealth fund) and Mediatek, one of the world’s largest mobile chipset makers, are some of its other investors.
On the business-facing side, PalmPay offers cross-border payments for merchants who want to send and collect payments across Africa via a single API, a recurring pain point (even with the promise of stablecoins). This newly launched business feature, currently live in Nigeria, Kenya and Tanzania (with South Africa in the pipeline), already processes “hundreds of millions of dollars monthly,” the company’s spokesperson confirmed.
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“My wife taught me something,” Klarna CEO Sebastian Siemiatkowski told the crowd at London SXSW. He was addressing the headlines about the company looking to hire human workers after previously saying Klarna used artificial intelligence to do work that would equate to 700 workers. “Two things can be true at the same time,” he said.
Siemiatkowski said it’s true that the company looked to stop hiring human workers a few years ago and rolled out AI agents that have helped reduce the cost of customer support and increase the company’s revenue per employee. The company had 5,500 workers two years ago, and that number now stands at around 3,000, he said, adding that as the company’s salary costs have gone down, Klarna now seeks to reinvest a majority of that money into employee cash and equity compensation.
But, he insisted, this doesn’t mean there isn’t an opportunity for humans to work at his company. “We think offering human customer service is always going to be a VIP thing,” he said, comparing it to how people pay more for clothing stitched by hand rather than machines. “So we think that two things can be done at the same time. We can use AI to automatically take away boring jobs, things that are manual work, but we are also going to promise our customers to have a human connection.”
He spoke about how the company plans to balance employees and AI workers. Siemiatkowski said that right now, engineering positions at the company haven’t shrunk as much as those in other departments, but he notes that this could shift.
“What I’m seeing internally is a new rise of businesspeople who are coding themselves,” he said, adding that the challenge many engineers have these days is that they are not business savvy. “I think that category of people will become even more valuable going forward,” Siemiatkowski continued, especially as they can use AI and put their business understanding to good use.
He himself is using ChatGPT to help him learn to code and help him understand more of the data side of Klarna. He said doing this has helped Klarna become a better company. Before, he thought he would never catch up in learning what was needed to take a more present role in database conversations at the company.
“I’ll take a Slack thread, I’ll throw it in ChatGPT and say, ‘This makes sense, right?’” he said, adding that he uses ChatGPT like a private tutor.
But he is also aware that AI isn’t just about employees. He spoke of the increase in scams and how it impacts high-trust societies like his native Sweden. The Financial Times recently reported on the rise of fintech scams, pointing out, for example, how susceptible residents in Singapore can be to them because they are more naturally trusting of various institutions.
“And AI is obviously accelerating this,” Siemiatkowski said.
Siemiatkowski also once again addressed why the company stopped using Salesforce and Workday, saying it was because Klarna wanted to consolidate its data in a way that would be easier to feed into AI. He said, for example, if Klarna wanted to gather information about one of its clients, it would have to go through the Google Suite, Slack, Workday, Salesforce, and so forth.
“We realize that the only way forward is going to be to consolidate [data],” he said, adding that the company stopped using around 1,200 small software services.
About it’s pending IPO? He indicated that Klarna could soon move ahead with it but was otherwise noncommittal. “I can say that I’m happy there’s less turbulence in the market,” he said with a smile.
And if he had a magic wand and could change one thing? He would make the U.K. part of the EU again. The crowd then erupted into applause.
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Venmo aims to be more than just an app for paying friends with its latest update.
On Wednesday, the PayPal-owned payment platform debuted several new debit card benefits and expanded the ability to make payments with retailers such as TikTok Shop and Uber. The updates signal Venmo is trying to become more of a full-service fintech service, not just a peer-to-peer payments app.
The revamped Venmo Debit Card, which was first introduced in 2018, now features a tap-to-pay capability, which could help Venmo position itself to capture a larger share of everyday transactions. Additionally, cardholders now get 15% cash back at Lyft, McDonald’s, Sephora, Walgreens, and Walmart.
Venmo also rolled out the option for cardholders to initiate automatic transfers, enabling them to schedule transfers and set specific balance thresholds that automatically trigger reloading when the balance falls below a certain level. Users can also make international purchases without incurring foreign transaction fees, a notable perk for frequent travelers.
For all shoppers, Venmo now allows users to make payments at brands such as Domino’s, Instacart, TikTok Shop, and Uber.
These updates come after Cash App’s Q1 shortfall, as its parent company, Block, revealed that consumers used the app less than anticipated, resulting in a gross profit of $1.38 billion, which was below its expectations.
In contrast, Venmo reported a 20% increase in revenue compared to the previous year. The usage of pay with Venmo jumped, with total payment volume increasing by over 50%, and the number of monthly active accounts rising by 30%.
Although Venmo has seen success, Zelle continues to maintain a significant portion of the U.S. peer-to-peer payments market, achieving a record high of over $1 trillion in payment volume in 2024.
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