African fintech company M-KOPA is thriving to exceed $400 million in annual revenue by the close of the year, up from $248 million in 2023.
Driving resilience and adaptability in the face of economic challenges such as inflation and currency devaluation across sub-Saharan Africa, M-KOPA operates as a pay-as-you-go asset financing platform.
The company has carved a niche by serving underbanked populations with innovative financial solutions.
Having reached over 5 million customers, the London-based company leverages its unique daily payment model to enable access to smartphones, micro-loans, and other essential products.
Profitability and Expansion
M-KOPA’s success is seen in its profitability across four key African markets—Kenya, Uganda, Nigeria, and Ghana—achieved since last year. It recently expanded into South Africa, now described as its fastest-growing market.
Mayur Patel, M-KOPA’s chief commercial officer, attributes the revenue growth to pricing adjustments, expansion into higher-value markets with stable currencies, and the addition of one million new customers in just six months.
Even though there are issues with default rates, which stand at approximately 10%, M-KOPA’s long-term strategy remains focused on maintaining stability and profitability.
According to Patel, financed smartphones are seen as productive assets, playing a huge role in boosting users’ earning potential and participation in the digital economy.
Innovations Driving Growth
A major factor in M-KOPA’s drive is its large distribution network. The fintech has over 30,000 active sales agents, up from just 3,000 four years ago.
These agents operate within local communities, facilitating access to smartphones and other products while setting up flexible payment plans tailored to customers’ daily incomes.
Added to this, the establishment of a smartphone assembly plant in Nairobi has enhanced sales of the M-KOPA X-Series smartphones, with over 1.5 million units sold since mid-2023. This reveals a shift from the company’s initial focus on solar power systems to more diversified offerings such as electric vehicles.
Driving Financial Inclusion
M-KOPA’s innovative payment model, requiring as little as $25 upfront and daily instalments of around 60 cents, is helping customers build credit histories.
This approach is particularly impactful in sub-Saharan Africa, where limited access to traditional credit systems leaves many individuals unable to finance essential purchases.
The company also reports economic benefits for its customers using its electric bikes, saving an estimated 30% of their daily income. To date, M-KOPA has deployed $1.5 billion in credit, expanding financial inclusion across Africa.
M-KOPA’s growth has been strengthened by financial backing from investors such as Sumitomo and Standard Bank, having raised $250 million in 2023, primarily in debt financing.
This year, the company secured an additional $15 million in funding and is one of Africa’s top fintech players by revenue.
Speaking on M-KOPA’s journey, Patel asserted the company’s focus on innovation and efficiency in serving its customers. “Over the last decade, we’ve continually sought to refine our processes, delivering world-class technology alongside robust offline distribution. This balance has been key to scaling our operations and driving value for everyday earners in emerging markets,” he noted.
While driving financial inclusion, M-KOPA is also maintaining profitability, even in challenging economic environments. Surpassing its $400 million revenue target will bolster its impact on the lives of millions across Africa.
