Nigerian startup, Verto, a global B2B payments platform that allows small and medium-sized enterprises (SMEs) to make payments to their suppliers, has announced the closing of $10 million in Series A funding.
The new funding has therefore increased Verto platform capacity, as using three main products – payments, exchange and multi-currency account – business owners can send cross-border B2B payments at FX rates up to nine times cheaper than they could through traditional banks.
Businesses can also hold money in over 200 countries across 39 currencies, and make instant cross-border payments to other companies on the Verto network in real-time up from 120 countries and 19 currencies previously.
The Verto website is designed for freelancers, SMEs and corporates, providing payments, exchange and multi-currency accounts to each segment.
These business owners can send cross-border B2B payments at foreign exchange (FX) rates up to nine times cheaper than they could through traditional banks, without a fee, Chief Executive Officer (CEO) Ola Oyetayo, said.
The no-fee proposition has caught on well with a userbase of over 2,000 businesses, each transacting an average of $30,000. Together they have facilitated billions of dollars in transaction volume yearly, according to the company.
Quona Capital, an emerging fintech-focused venture capital firm, led the round. Other firms also participated, including Treasury, founded by Betterment’s Eli Broverman and Acorns’ Jeff Cruttenden; Middle East Venture Partners (MEVP); U.K.-based TMT Investments; Unicorn Growth Capital; Zrosk Investment Management; and P1 Ventures.
While fintechs are creating solutions around peer-to-peer payments and remittances, most are consumer-focused. Meanwhile, the business to business (B2B) market, accounting for 30% of the world’s global imports and 45% of total employment in emerging markets — is largely untouched.
Frictionless payments
Launched in 2018 by two U.K.-based Nigerians, co-founders Ola Oyetayo and Anthony Oduwole, developed Verto as a fast and frictionless global payments platform that uses a marketplace solution to match businesses efficiently, especially where one of the currency pairs is an illiquid currency.
Initially, the YC-backed company acted as a currency exchange marketplace to help businesses transact illiquid currencies into liquid pairs. But upon gaining a transaction and subsequently raising a $2 million seed round two years ago, feedback from users highlighted the importance of providing cross-border payments as well.
“We’ve now evolved more from not just being a currency exchange marketplace to a full suite of cross border payments products for businesses,” Oyetayo said. “While traditional peer-to-peer payment platforms often have transaction limits, the Verto platform facilitates payment volumes that are appropriate for MSMEs.”
Similar to most fintechs, the company has benefited from a global shift of people moving to digital methods of payments and the fact that more homogeneous businesses in Africa are transacting with each other through digital channels.
Verto’s innovative platform addresses these pain points, removing friction to make international payments fast, simple, and reliable – a key component of SME growth.
Not only can businesses use Verto for their personal payments needs, but they can also piggyback on the company’s rails to build solutions for their end clients. For instance, an investment management platform that allows customers to buy stocks on its platform can use Verto to convert currencies and facilitate pay-ins and payouts.
“That solution is geared towards developing markets where it takes businesses to pay customers days or weeks to make payments,” said Oduwole. “Our in-house compliance solution allows them to transact and get settled instantly, or in some cases a couple of hours.”
In a statement, Co-founder and Managing Partner at lead investor Quona Capital, Monica Brand Engel, said: “Verto’s innovative platform addresses these pain points, removing friction to make international payments fast, simple, and reliable – a key component of SME growth. We are proud to support Verto in this important and impactful work.”
She commended the platform’s ability to address problems businesses face with low visibility, slow speeds and high costs of cross-border payments. Verto is doing “important and impactful work,” she said.
Before the end of the year, Verto expects to increase the list of currencies on its platform to 51, Oduwole said. The company will use the investment to achieve that while building its platform to enable businesses to move money across borders more efficiently, it added in a statement.
Interestingly, Verto has only six African currencies on its platform; they cover 60% of the continent’s GDP. And with the B2B global payments industry expected to grow to almost $200 trillion by 2028, Verto plans to accelerate its geographical expansion into more markets in Africa and the Middle East.
“We want to get to a point in the future where someone can easily swap a Ghanaian cedi to rand without having to transact with dollars or euros,” the founders said.
