Nigerian Lending Fintech, Payhippo, secures $1million in pre-seed funding

Nigerian Lending Fintech, Payhippo, announced that it has secured $1million in pre-seed funding. Investors include Africa tech investors such as Ventures Platform, Future Africa, Launch Africa, Sherpa Ventures, DFS Lab and International investors such as Hustle Fund and Mercy Corps Ventures. The company says it had prior Friends and Family backing from notable Nigerian angel investors and from early stage venture builder — Aidi Ventures.

Founded in 2019 by Zach Bijesse (CEO), Chioma Okotcha (COO), and Uche Nnadi (CTO) , Payhippo is an AI-Driven lending platform making it easier to finance small and medium sized businesses. Its mission is to serve the 40 million small and medium sized business who are unable to gain access to the funds necessary to grow their business.

The founders have worked together before Payhippo, have founding experience, and have the lending domain expertise to best service SMEs in Africa.

• Chioma Okotcha (COO) worked in microfinance policy, ran her family’s SME in Nigeria, and helped build the international NGO Teach For Nigeria across multiple states in the country.
• Uche Nnadi (CTO) was a full stack engineer at consumer lending fintech Earnest and has been mentoring Nigerian engineers for 5 years.
• Zach Bijesse (CEO) worked at Lidya, Africa’s most well known SME lender. He saw that fintech SME lending had a gap of providing same-day financing when the businesses need the capital.

According to the startup, it has disbursed over 2,600 loans to businesses since it started business in January 2020. Majority of its customers were community grocery stores or small retail shops. Payhippo says it has had a 97% repayment rate while growing revenue 25% month on month.

Payhippo will use the pre-seed funds to hire more engineers and a Head of Finance to keep up with the current growth.

The market size for SME lending in Nigeria is $46 billion. And Payhippo’s founders have a personal connection to this market opportunity.

According to Chioma Okotcha, “I helped run my family’s business in Nigeria and I know how tough financing can be for SMEs in Nigeria. That’s why I went to work in microfinance policy. But I saw that there still that there was still such a big need for SMEs in Nigeria and the continent.”

Even though most of the SMEs are creditworthy, they cannot get the necessary funding from banks because there are no credit scores and collateral requirements are too high.

So Payhippo has been able to provide funding to this segment by assessing businesses, building their Payhippo Scores, and in turn provide financing to them.

“I am proud of our platform. There are endless issues that Nigerian SMEs experience with financing but we’ve been taking it one step at a time. I talk to our borrowers every day to get product feedback. Our borrowers tell us that our loans are more seamless than anything else they have seen in the market.” Uche Nnadi, Payhippo Cofounder and CTO.