MoneyFellows, an Egyptian fintech startup, has scored $4 million in a Series A round to expand across Africa as well as boost operations in Egypt by launching new products in the coming months.
The investment was raised from Partech and Sawari Ventures.
MoneyFellows digitises the concept of money circles (ROSCAs) which are commonly known as gam’eya in Egypt and other Arab countries, through its online platform. It was founded in 2016 by Ahmed Wadi.
The practice that is quite popular for saving money in different parts of the world allows a group of people (who are normally friends or colleagues) to contribute a fixed installment every month to a pool with one of the members taking the whole pool as payout every month.
The circle ends when everyone receives their payout and is usually repeated if the participants are interested.
MoneyFellows with its mobile-based platform has digitized this entire process with a scoring model that compliments offline model, making it more scalable, safe, and efficient.
In a statement, the Egyptian fintech said that it currently has over 150,000 active users that are verified by a user assessment algorithm. It also works with different corporates in Egypt, enabling their employees to participate in the money circles for saving money.
Ahmed Wadi, founder and CEO of MoneyFellows, in a statement, said, “Being backed by Partech and Sawari Ventures – two top investment firms, helps us reap global, as well as local know-how, best practices, and support.
“Partech’s support from their African fund will help us expand into other countries in the continent with hands-on global expertise.
“While Sawari Ventures have been a cornerstone of MoneyFellows’ journey for the past three years; from day one they have been with us, and bring to the table a cachet of knowledge, alongside a vast network of relationships with key corporates and financial institutions, making them our optimal local partner,” he added.
Cyril Collon, a General Partner at Partech, said, “We are proud to have MoneyFellows join Partech’s investment portfolio to support the company to scale and expand.
“The team is fantastic and the product sophistication is unique, making money circles attractive for millennials and their grandparents.
“The impact of MoneyFellows on financial inclusion is already massive in Egypt, as the solution offers convenient secured lending and saving schemes to consumers by digitizing a traditional savings model.”
Hany Al Sonbaty, a Managing Partner at Sawari Ventures, said, “MoneyFellows is one of the most promising fintech companies to come out of the region; their fusion of technology and existing ROSCA (Rotating Savings and Credit Association) culture solves both the problem of financial inclusion and helps people to better plan their personal finances.”
“In enabling people to save beyond their immediate circles, they are not only promoting a culture of saving, but also facilitating a gateway for the further introduction of financial services to larger numbers of people as they become more financially aware.
“We are thrilled to be investing in the company and joining them on this exciting journey,” he added.