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SA fintech Peach Payments has raised new investment to drive its expansion into Africa, in a round led by Umkhathi Wethu Ventures (UW Ventures), in partnership with Allan Gray.
A number of industry executives from Europe and South Africa, as well as existing investors also participated in the round.
It comes after an announcement earlier this week that the two investors had, together with SA venture capital (VC) company 4Di Capital, invested in another SA fintech, CompariSure (see this story).
Peach Payments operates a B2B online payments platform for businesses in South Africa and was founded in 2012 by German Andreas Demleitner and Indian born Rahul Jain. Jain, who is originally from Delhi, is based in Cape Town, while Demleitner lives in Berlin, Germany.
The company did not reveal the size of the investment. However, when pressed by Ventureburn on whether the round was above R10-million, Jain conceded it was.
Peach Payments previously raised a €50 000 seed round in 2013, after participating in the 2012 Google Umbono/88mph accelerator. The fintech netted a second, undisclosed investment a few years later from an Austrian angel investor.
Growing demand
Jain says demand for Peach Payments’ services is growing. He says the company currently services between 1500 and 2000 merchants — including three of South Africa’s four big supermarket groups — and is signing up 200 to 300 new merchants every week.
The Covid-19 pandemic has helped the fintech to close sales from merchants who for long have been mulling whether to go with Peach Payments or not.
To keep up with demand the company has made two hires each in March and April and now has 40 employees. This, while staff are working on weekends and in the evenings, to meet demand, he says.
It was like this that the company was able to close an agreement in March with the popular website building platform Wix.
The agreement allows the business to now offer support for platforms such as Xero and Wix – to make it easier for African startups and SMEs to easily take their business online.
As such Peach Payments now allows those who use the Wix platform to build online businesses, to have access to market leading card processing and EFT solutions. The fintech is also a payment partner for Shopify, WooCommerce and Magento, among others.
Jain pointed out that it had taken two years for the company to land the agreement with Wix, but that two weeks before South Africa’s lockdown the deal had finally gone through.
Turning to the company’s African expansion plans, Jain said while Peach Payments launched a bid to expand to Kenya in 2016, the company only began signing up merchants there at the end of last year, after coming up against regulatory challenges there. Things were made easier when the Kenyan government later changed a number of payment regulations.
And while the Covid-19 pandemic may have restricted travel between African states, Jain said the company will use the credibility it has built up over eight years and the numerous meetings already held with those across the continent before the pandemic to broker sales deals. The company, for example has already been visiting Nigeria for over three years.
“We’ve been pushed,” points out Jain when referring to how the company is having to service the increased demand. But he is certain that the pandemic has ushered in a totally new order of things, where online payments have become the norm.
Says Jain: “The acceleration of the adoption of ecommerce won’t go back after lockdown”.
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