Tanzanian FinTech Startup, NALA Follows in Flutterwave’s Market Entry as it obtains a Money Remittance License in Uganda
NALA COO, Nicolai Eddy (centre) receiving their International Money Transfer Operator (IMTO) licence. Source: NALA/Instagram
NALA has successfully acquired an International Money Transfer Operator (IMTO) license. This will give the FinTech a major boost as it aims to expand its operations into the country. This development will enable NALA to directly inegrate with mobile money services as it will allow users to pay into local mobile wallets with ease. Additionally, it will improve the efficiency and security of cross-border payments for individuals and businesses.
This comes nearly two months after it secured $40 million Series A funding to boost the company’s growth plans. One of those plans was primarily building Rafiki, its new B2B payment platform. Acrew Capital, a San Francisco-based venture capital (VC) firm, led the Series A round with participation from DST Global, Norrsken22, and HOF Capital. Existing investors, including Amplo and NYCA Partners, and several angel investors, such as fintech founders – Chime’s Ryan King and Robinhood’s Vlad Tenev of Robinhood – also invested in the payment solutions company.
Nicolai Eddy, NALA’s Chief Operations Officer (COO), highlighted that the licensing provides an opportunity for the large number of Ugandans in the diaspora to use the fintech’s services, which are free of charge.
“If you need that money immediately, you will be able to receive it instantly and the same amount without any deduction through our payment plan product.
“For us, money remittances a volume game and we care about doing large volumes. On small transactions we will not make money but on individuals who send large amounts allow us make some money to keep the business alive,” he added.
Eddy also pointed out that a significant portion of remittances goes toward basic needs such as education, medical care, and household expenses. While the remittance process has improved, he acknowledged that more work is needed to ensure it fully supports people’s lives.
He also added that NALA has worked closely with the Bank of Uganda to meet all requirements for making remittances accessible. Again, he mentioned that the license will help boost the supply of foreign exchange in Uganda, which is crucial for economic growth.
NALA was founded in 2017 by Benjamin Fernandes. Since then, it has gradually built its capacity, facilitating money transfers from the UK, US, and EU to various African countries, including Tanzania, Kenya, Egypt, Uganda, Ghana, Rwanda, Cameroon, Côte d’Ivoire, Senegal, Nigeria, and South Africa.
On August 28, 2024, Flutterwave also obtained a Payment Systems Operator (PSO) licence from the Bank of Uganda, enabling businesses in the country to use its payment solutions. This development shows the fintechs’ interest in expanding the digital remittances market in Uganda, which is projected to reach $17.99 million in transaction value in 2024. The market is also expected to grow at an annual rate of 8.35% from 2024 to 2028, potentially reaching $24.79 million by 2028.
