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A digital bank just secured $1.6 million seed funding

Kuda, a FinTech modelled after the operations of a digital bank has just raised the sum of $1.6 million for the purpose of deepening its inclusion and maintaining the operation of its virtual branches

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A digital bank just secured $1.6 million seed funding

Nigerian FinTech startup, Kuda, has raised the sum of $1.6 million for the purpose of deepening its inclusion and maintaining the operation of its virtual branches.

The funds were raised in Pre-Series A round led by Haresh Aswani, the Managing Director, Africa Division of the Tolaram Group, Ragnar Meitern and other angel investors.  

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The startup which is modelled after the operations of a digital bank, primarily operates on smartphones via the prompt of a USSD code, ruling out any need for a building. The side attraction for the bank is that it can afford to charge reduced bank charges, thus providing a big competition for the mainstream banks. 

 [READ ALSO: From Pre-Seed to Series D: Startup Funding Rounds Explained

While commenting on the financing, the founder of Kuda Bank, Babs Ogundeyi said, We profit when our customers are happy to keep their money with us. We do not charge card maintenance fees or account maintenance fees or COT or any other code name that is used to extract fees from customers.

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How the funds will be deployed: Having launched a beta version of its mobile application in August this year, the company has been working to commence full operations after product testing. With the newly generated funds, the bank is looking to commence operations in the final quarter of the year.

[READ MORE: Mortgage Banks get boost, as Mwfl steps in to support the Mortgage Sector

The company disclosed that part of the money would be divested into further development of the banking platform to make it more secure. There are also plans in the works to include support for a Lagos and Cape Town-based developer team while eyeing a Pan-African digital-only bank status. 

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What this means: The FinTech will be able to process large amounts of data in real-time and give customers more control over their financial choices through its real-time disbursement of data.

What you should know: Kuda enters an already crowded fintech market with major players like Piggyvest, Flutterwave, Paga, Paystack to name a few. This is a boost in the potentially revenue-rich market as the country becomes ground zero for payments startups and tech investment in Africa

Brand Repositioning: The startup began as Kudimoney before rebranding to Kuda as a result of the adoption of the name “Kudi” by several fintech startups. Kuda is different from Kudi, a Series A stage Nigerian utility payments startup. Kuda also struck partnerships with three of Nigeria’s Tier 1 banks, GTBank, Access Diamond and Zenith to scale up their branding efforts. Ogundeyi did well to clarify that the banks are partners, not investors.

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About the company: Kuda, was founded in 2018 by Babs Ogundeyi and Musty Mustapha. The company runs predominantly on smartphones and via a USSD channel. Even without physical locations (branches), the company claims to be the most connected bank in Nigeria. The startup received a license from the Central Bank of Nigeria in June this year. 

[READ FURTHER: Nigerian energy startup raises $9 million in Series A funding] 

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Patricia

Chidinma holds a degree in Mass communication from Caleb University Lagos and a Masters in view in Public Relations. She strongly believes in self development which has made her volunteer with an NGO on girl child development. She loves writing, reading and travelling. You may contact her via - [email protected]

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Economy & Politics

Just in: Buhari suspends EFCC boss, Ibrahim Magu from office

The suspension follows the investigation of allegations of gross misconduct against him on Monday.

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EFCC to help AMCON recover bad debts

President Muhammadu Buhari has approved the suspension of the acting Chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu, from office. The suspension follows the investigation of allegations of gross misconduct against him on Monday.

According to available information, Magu was suspended to allow for probe into allegations against him.

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The EFCC boss appeared before a presidential probe panel headed by retired Justice Ayo Salami, who is investigating the allegations against him.

Details later…

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Economy & Politics

Reps to investigate alleged illegal withdrawal of $1.05 billion from NLNG account

Gbajabiamila mandated the House to conduct a thorough investigation on activities of the dividends account.

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Reps to investigate alleged illegal withdrawal of $1.05 billion from NLNG account

The House of Representatives has concluded plans to investigate the alleged illegal withdrawal of $1.05 billion from Nigeria Liquefied Natural Gas (NLNG) account by the Nigeria National Petroleum Corporation (NNPC) without its knowledge and appropriation.

The decision by the lower chamber is on the heels of a unanimous adoption of a motion by the Minority Leader of the House, Ndudi Elumelu, during plenary session on Tuesday, July 7, 2020.

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Going down memory lane, Elumelu recalled that the NLNG was incorporated as a limited liability company in 1989 with the aim of producing liquefied natural gas and natural gas liquids for export purposes which began in 1999.

He pointed out that the NLNG is jointly owned by the Federal Government, represented by the NNPC with a shareholding of 49% and Shell Gas with 25.6%, Total LNG Nigeria Ltd with 15% and ENI International with 10.4%.

READ MORE: Nigeria’s debt rises to $79.5 billion, as debt to revenue ratio worsens

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The Minority leader said, “The dividends from the NLNG are supposed to be paid into the Consolidated Revenue Funds Account of the Federal Government and to be shared among the three tiers of government.’’

Going further in his motion, Elumelu said, “The NNPC who represents the government of Nigeria on the board of the NLNG had unilaterally without the required consultations with states and the mandatory appropriation from the National Assembly illegally tampered with the funds at the NLNG dividends account to the tune of 1.05 billion dollars thereby violating the nation’s appropriation law.

“There was no transparency in this extra-budgetary spending as only the Group Managing Director and the corporation’s Chief Financial Officer had the knowledge of how the 1.05 billion dollars was spent.’’

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‘’There are no records showing the audit and recovery of accrued funds from the NLNG by the Office of the Auditor General of the Federation. Hence the need for a thorough investigation of the activities on the NLNG dividends account.

In his ruling, the Speaker of the House, Femi Gbajabiamila, mandated the House Committee on Public Account to conduct a thorough investigation on activities that had taken place on the dividends account.

Gbajabiamila mandated the committee to invite the management of the NNPC as well as that of the NLNG in the process and report back to the house in four weeks.

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Coronavirus

COVID-19: We may recommend lockdown to ensure Nigeria’s safety – PTF

PTF on COVID-19 on Monday, Mustapha warned that the deadly virus is still spreading at an alarming rate.

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COVID-19: Reactions trail FG travel ban on 13 countries

The Secretary to the Federal Government and Chairman of the Presidential Task Force on COVID-19, Boss Mustapha, disclosed yesterday that the PTF will not shy away from the possibility of another lockdown, adding that the PTF will recommend it to the President who will make the final decisions.

While speaking during the national daily briefing by the Presidential Task Force (PTF) on COVID-19 on Monday, Mustapha warned that the deadly virus is still spreading at an alarming rate.

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“Therefore, we cannot afford to slow down and we must never compromise. Let us continue to learn from the history of pandemics by avoiding the mistakes of 1918.

“What happened in 1918 was very simple. During the Spanish Flu, it lasted for 2 years and in three waves, and during that period of time, 500 million people were infected, out of which they recorded fatalities of about 50 million persons. But the dangerous phase of the flu was the second phase,” Boss Mustapha said.

He added that the Spanish Flu lasted for 2 years of 1918 came in 3 waves, but the phase the most casualties were recorded was in the second phase. Adding that the impatience of people forced governments to lift lockdowns, and by the time the second wave arrived, millions died.

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READ MORE: FG may lift ban on interstate movement on June 21

He acknowledged that the possibility of lockdown would not be popular with Nigerians, however, “but what will happen in the preceding weeks will determine”, citing rising cases in the United States after the holiday weekend and a the newly imposed lockdown in Madagascar despite developing its “herbal cure”.

“I believe as the days and weeks ahead will present, we will not speculate what will happen in the future but we will do everything within our mandate to ensure the safety and protection of the people of Nigeria. If that will recommend a prescription of a lockdown, this task force will not shy away from its responsibilities.”

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He added that the recommendations of lockdown would be passed to President Buhari who will decide in the next 2 weeks.

“The PTF urged Nigerians to be vigilant, citing global developments in coronavirus in the past week from China to the United States.

“We urge that vigilance and care should be exhibited by all Nigerians irrespective of status. This virus does not discriminate and the PTF shall keep sustaining its sensitization messaging,” Mustapha stated.

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