Kenyan fintech startup Power has raised $3 million in a seed funding round to expand its financial offerings in Kenya and to introduce its services to Zambia and other African countries. Power provides employees with access to short and long-term loans, investment opportunities, and insurance products. The $3 million seed funding round was led by DOB Equity, with QED Investors, Quona Capital, Zephyr Acorn, and Norrsken Impact Accelerator also participating. Power plans to partner with banks to offer its services and expand to at least ten African markets over the next three years. Currently, the company has onboarded 75 companies in Kenya, giving it access to over 40,000 workers, of which it has served 15%. The startup's CEO, Brian Dempsey, said the company's latest strategy in Zambia is to be a technology partner instead of an active lender, signing a deal with First Capital Bank to support this move.
According to Brian Dempsey, Power aims to partner with banks in countries like Malawi, Mozambique, Botswana, and Zimbabwe and to expand to southern African countries like Zambia. The company plans to leverage technology to enable banks to offer a new range of services to workers. Power allows employees to access a portion of their salary in advance and provides long-term loans based on their earnings at a monthly interest rate of 2-3%. The company also offers various insurance products that can be repaid over an extended period, and it introduces its clients to money-market and pension funds.
Power's unique approach to lending only to employees and contractors of onboarded companies helps to reduce the risk of default and ensures that borrowers can only get the money they can afford to pay back. The HR personnel of the companies onboarded on Power's platform can access, approve, and reject employee loan requests.
Gbenga Ajayi, QED Investors' Africa Head, and Partner expressed his enthusiasm for collaborating with Power in Kenya to offer targeted financial services to a demographic that has been overlooked or underserved by current providers. He looks forward to sharing insights gained from similar businesses worldwide to support Power's growth in Kenya and across Africa.
Power's co-founders, Brian Dempsey, and Chandra Singh, launched the company in 2020. Since then, the startup has disbursed over $1.5 million in loans and served 15% of the over 40,000 workers it has access. The company integrates with its clients' payment or payroll systems to allow its workforce to download the Power app, conducts digital identity checks, and provides its four key services. With its new seed funding, Power aims to expand its services to more African markets and increase its user base.
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