Churpy raises $1M to help businesses reconcile and manage payments across Africa – MovieUpdates

Churpy, a fintech startup based in Kenya, aims to expand across Africa by establishing hubs in Egypt, Nigeria and South Africa for planned growth across the continent, powered by the $1 million in seed funding it has just raised .

The accounts receivable automation startup aims to change the way companies manage their customers’ debts through its SaaS product, which automates the processes for reconciling incoming payments and invoices, a labor-intensive process that is still predominantly manual for most local businesses.

The startup is connected to some of the largest banks in the region – including Citibank, Sidian, Stanbic and NCBA – through its API, which gives companies using their SaaS product access to real-time statements and transaction data that can be used to pay pending invoices from enterprise resource planning systems (ERPs) — used to track day-to-day business activities such as accounting and supply chain activities.

“We are hiring more people as we plan to enter Egypt, Nigeria and South Africa, the hubs of their… [respective] regions. We are also investing money in product development as we plan to scale our offerings,” Churpy co-founder and CEO, John Kiptum, told MovieUpdates.

Churpy’s partner banks have a presence across Africa, which Kiptum says will make it easier for the startup to scale its operations.

Kiptum co-founded Churpy last year, along with Kennedy Mukuna whom he had met a year earlier during an Antler East Africa accelerator program. Both Kiptum and Mukuna have extensive experience in data analytics, banking and risk management and have worked for organizations such as the World Bank and Citibank. Their experience in the banking industry, they said, made them aware of the pain points for customers in the sector. The founding team has since been joined by James Kanyangi, who has extensive experience in payment transactions, AI and robotics.

“It really wasn’t difficult for us to unlock a lot of ideas, products, innovation and technology around the financial sector. We’ve been there, we’ve seen how it works or why it doesn’t work, why it’s slow, why it’s ineffective, and why customers aren’t happy. And so what we build is inspired by real experiences,” says Kiptum.

The startup is conducting a pilot program with some of the top manufacturing and service companies in Kenya, including Unga Limited and Chandaria Industries.

“On the dashboard, these companies can see who they have money from, how efficient they are at collecting and how liquid they are, and other operational metrics. This will allow the chief financial officers and their teams of accountants to take more strategic roles from the company and follow up on those who have not paid,” said Kiptum.

Embedded finance product for SMBs

Churpy also plans to roll out a working capital financing product targeting small-medium sized businesses that will deliver to the enterprise customers signed up for the startup’s SaaS product.

The SMEs benefit from immediate payment for goods delivered to these companies, instead of waiting the usual period – up to two months – to receive their money.

“SMEs have a huge financing gap. They are the suppliers of these large companies and need capital to continue to bring raw materials to their other customers. Usually they need collateral to access loans from banks and wait for approval to access capital to keep their business going. What we do is make sure that they are paid not long after they have delivered goods to partner companies, at an origination fee of 0.5%. As soon as their bill expires, we get paid,” says Mukuna, also product head of the startup.

The startup has partnered with a number of banks to roll out the service as part of its strategy to unlock other services around account reconciliation. To begin providing financing to SMEs, Trade Development Bank has made $15 million available to Churpy (payable through its banking partners) for further lending.

The recent seed round was led by Unicorn Growth Capital with the participation of Antler East Africa (after a $100,000 pre-seed), Nairobi’s business angel network and some Rally Cap’s LPs, including senior executives from Stripe.

Barbara Iyayi, Founder and CEO of Unicorn Growth Capital, said: “It is clear that B2B payments business is significantly under-penetrated and ripe for modernization and disruption globally. We are excited to partner with the Churpy team as the first mover on the market.”

“Churpy is the only available end-to-end platform that offers accounts receivable automation, an invoice marketplace and reconciliation with integrated B2B payments specific to its markets. They are well positioned to be a critical partner for businesses and lenders in Africa, and can effectively address the significant credit gap SMEs face for supplier financing and working capital,” said Iyayi.

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