Kopo Kopo Changes Focus From Payments to Micro-Lending, Announces New CEO
After raising $2.10 million in equity financing, Kenyan payments platform Kopo Kopo is pivoting its business away from the Lipa Na M-Pesa service it offers in partnership with Safaricom to focus on micro-loans to businesses. To this effect, the company has appointed a new CEO to direct the company’s growth and shift in focus.
At the same time, Kopo Kopo’s co-founders Ben Lyon and Dylan Higgins are leaving the company, five years after setting it up. Ben notes that the shift in the company’s focus is necessary, as the company has hit a wall as far as innovation is concerned.
“At heart, I’m an entrepreneur and love to build things, and we’re not at that stage any more with Kopo Kopo,” Lyon told TechMoran. “Today, Kopo Kopo operates within a well-defined ecosystem. We know what we need to do, how we need to do it, and where it needs to go. In turn, we’ve hired an excellent team of operators to execute on the opportunity in front of us.”
The funds raised from the equity financing will be used to support Kopo Kopo’s GrowMerchant Cash Advance product. Ben and Dylan have invested a lot of their energy towards this project,and they are happy to see it take off. “We’ve seen incredible returns from Grow to date”, Ben adds, “so we are now focused on optimizing the service for the benefit of Kenyan businesses.”
Grow is an unsecured merchant cash advance service for customers that process Lipa Na M-Pesa, credit, or debit card payments. The service enables existing and new Kopo Kopo customers to take cash advances of up to 3 million Kenya Shillings (US$ 29,300), with the borrowers paying a 1% fee in lieu of interest.
For repayment, the borrower chooses how much Kopo Kopo can withhold as a percentage of future sales , and then the lender automatically deducts that from every payment received. This continues until repayment is complete, regardless of length.