A financial technology company from a mid-sized African country has managed to raise $14 million from venture capitalists in the region. Its name, Djamo. Its goal, to democratize access to banking products for French-speaking individuals within the region.
Djamo’s funding round was led by Enza Capital, Oikocredit, and Partech Africa and counted on the participation of four other VC firms. The firm was founded by Régis Bamba and Hassan Bourgi in 2019 and has managed to increase its user base from 90,000 to 50,000 in less than 2 years.
How Does Djamo Work?
Djamo offers a suite of digital banking products including a flagship Visa debit card and a money wallet for people who have largely been shunned by traditional African financial institutions.
Their app is available on both iOS and Android. Meanwhile, its flagship debit card is issued by the BGFIBank of the Ivory Coast.
Djamo charges monthly subscriptions for the use of its services. There is a free tier that allows users to make deposits, withdrawals, and payments while there are also two paid subscription tiers that give individuals a bank account number and privileged access to customer service.
Both the free and paid subscriptions allow users to send money to mobile wallets and bank accounts. With the free package, the cost of these transactions is 1.5% while the same transactions are free of charge for premium users.
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Its suite of services also includes a feature that allows workers to receive their salaries within the app and a savings product that allows users to set automatic periodical deposits to create emergency funds or save for a trip.
Banking the French-Speaking Unbanked is What Djamo is All About
According to data from Statista, 45% of all individuals in Sub-Saharan Africa are reportedly unbanked. Even though the percentage has diminished significantly in the past 10 years amid the launch of services like Djamo, it is still quite high compared to the 22% seen in Europe and 26% in Latin America & the Caribbean.
Solving this problem has been possible amid the intervention of telecom companies that have launched digital money wallets to go where traditional banks have opted not to go. The result, they have reached out to roughly 60% of the region’s population.
Djamo’s mission is to offer more sophisticated services to this already growing population of digital account holders and more especially to French-speaking customers. Estimates indicate that more than 100 million people in Africa speak French or a local variation of it.
“Francophone Africa offers a large integrated market, with [a] fast-growing demand for frictionless services from a new cohort of digital-native young adults. We are excited to join forces with high-caliber local investors who bring sector and regional expertise to enable Djamo to unlock this opportunity”, commented Tidjane Deme, general partner at Partech Africa, another VC firm that participated in Djamo’s latest funding round.
The fintech company is already claiming that theirs is the largest funding round ever for a startup in the Ivory Coast.
Djamo has several competitors in the region but the space seems to be large enough to sustain this kind of fragmentation, especially if companies focus on relatively unserved niches whose needs are rather unique.
The firm wants to excel at providing the best customer experience possible as they believe that users in the region are accustomed to experiencing frustration when attempting to access traditional banking products.
“The one thing that we want to achieve is to offer a product where customers get real value for their money”, Bamba, who is also the company’s Chief Product Officer, stated in a phone call with TechCrunch.
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