Headquartered in Lagos, the company works with banks, fintechs and other lenders to acquire and manage non-performing retail and SME loans. 

The latest round drew support from several African private equity and venture capital firms, including AfricInvest through its Financial Inclusion Vehicle fund, as well as Algebra Ventures, which made its first investment in a Nigeria-headquartered business through the deal.

Existing investors, including Capria Ventures, VestedWorld, Axian CVC, Angaza Capital, 4Di Capital and DotExe Ventures, also returned for the round.

BFREE said the new investment will help it pursue larger acquisitions of bad debt portfolios while strengthening long-term agreements with financial institutions that regularly offload non-performing accounts.

Having raised $3 million in funding in 2024, the company started as a technology-driven debt collection business before shifting into direct acquisitions of distressed unsecured loans, ranging from nano credit to SME facilities. 

Since launch, BFREE has completed more than 35 transactions and now manages over 11 million borrower accounts across several African countries.

Chief Executive Officer Julian Flosbach said the company now plans to operate at a larger scale.

“The market opportunity is significantly larger than the infrastructure historically available to address it. This round puts us in a position to pursue substantially larger portfolio acquisitions, engage a broader range of institutional partners, and do so with the speed and certainty of execution that serious counterparties demand,” he said.

Rather than handling one-off recoveries, BFREE works through forward flow arrangements. Under those deals, lenders agree to sell newly non-performing loans to the company on a recurring basis.

BFREE said its collection model avoids intimidation and public shaming, practices that have long attracted objection in parts of Africa’s digital lending sector. Instead, it focuses on repayment structures that borrowers can realistically manage.

Patrick Herrmann, partner at AfricInvest, said the company is filling an important gap in Africa’s fast-growing digital credit market.

“BFREE’s approach to credit management, based on a unique set of proprietary data and a technology-enabled collection platform, closes an essential gap in the digital lending value chain. 

“High-velocity digital lending has become a core product across markets, with financial institutions, banks and fintechs alike requiring effective ways to manage small-ticket non-performing loans. 

“BFREE’s execution-driven team has brought the platform to an inflexion point, which will enable them to purchase larger portfolios and become a prime partner for banks and fintechs across African markets,” he said.

For Omar Khashaba, general partner at Algebra Ventures, the investment shows encouraging interest in Africa’s distressed debt market, where lenders still struggle to resolve billions of dollars in unpaid retail and SME loans every year.

“Billions of dollars in African retail and SME credit go unresolved every year because the institutional infrastructure to clear them simply does not exist. Healthy credit markets need a disciplined buyer for distressed debt. 

“The founders Julian, Moses and Chukwudi have built a platform that combines rigorous portfolio pricing, risk management, and deep data infrastructure to clear distressed retail and SME debt at scale. We are backing BFREE together with AfricInvest to scale them across Africa and beyond,” he said.

BFREE did not disclose the size of the investment round. However, the company said the capital will support expansion in both existing and new African markets where demand for distressed debt solutions continues to grow.

In its latest round, PayTic raised $4.4 million in fresh funding to deepen its operations in the Middle East and Africa. 

AfricInvest led the round, joined by Axian Venture Lab and Mistral VC. Existing backers like CDG Invest, BVC, Concrete VC, and ICP Ventures also returned. This brings the company’s total funding to $7.4 million.

Founded in Casablanca in 2020 by Imad Bouhmadi, PayTic was built not to impress consumers, but to rescue banks, fintechs, and card issuers from the chaos of their own operations.

While many startups focus on the front-end user experience, PayTic goes where the real problems live—in the backend, where reconciliation, chargebacks, fraud checks, and compliance live and breathe.

Bouhmadi calls it “the operational aftermath of payments.”

This isn’t a space most people want to think about. But for institutions juggling multiple card programmes, payment rails, and regulatory obligations, it’s hell. PayTic’s solution? An end-to-end platform that doesn’t just integrate with existing systems—it practically replaces the manual processes still plaguing the industry. And it doesn’t need code to do it.

“The problem we’re solving is largely invisible to consumers but mission-critical for fintechs, banks, and card issuers,” Bouhmadi said. “We’ve built a no-code operating system for payment operations.”

That system gives clients a clean dashboard to handle everything from line-by-line invoice analysis to auto-generated BIN sponsor invoices. It’s not classy, but it’s transformative. Tasks that once took hours or even days can be done in minutes—with far less human error.

Unlike competitors like UK-based Kani Payments, which zeroes in on reconciliation alone, PayTic is gunning for full spectrum dominance. “They focus on one piece of the process,” Bouhmadi said. “We’ve built an end-to-end solution that’s integration-free, no-code, and instantly usable across the operational spectrum.”

Right now, PayTic works with more than 20 institutions spread across Europe, the Middle East, and Africa. Some names include Morocco’s CIH Bank, CFG Bank, and BNI Madagascar. OGS, the processing engine behind Bank of Africa, is also on that list. It’s also in talks with players in Nigeria, a market Bouhmadi calls “one of the most exciting fintech ecosystems on the continent.”

The revenue model is a mix of SaaS subscription fees, volume-based pricing, and revenue-sharing agreements. It’s flexible, which makes sense for a tool designed to untangle complexity.

Is the market big enough? It’s bigger than it looks. With Africa’s payments sector becoming more layered, the old ways of doing things simply don’t scale. Without operational automation, banks and fintechs risk drowning in their own data and red tape.

PayTic sees this—and it’s betting the future of finance lies not in the user interface, but in the machinery underneath it.

This funding is not just about growth. It’s about leverage—getting the product into more hands, building stronger partnerships, and pushing further into underserved regions. Bouhmadi said, “We view PayTic as a key enabler to our ability to grow our business. As we add more card programs, we will be sure to have PayTic there to help us manage the back-office program functions.”

It’s an unglamorous mission. But if PayTic delivers, it could become the quiet innovation behind the working African and Middle Eastern financial infrastructure.

Today, only a fifth of the African population has access to formal banking services. Limited access to finance restricts entrepreneurship, job creation, and the ability to absorb economic shocks. 

Swedfund’s investment addresses this gap by supporting financial institutions that are expanding outreach and developing inclusive financial products, especially through new technology and digital solutions.

“Our investment in FIVE further strengthens our engagement to improve access to banking and other financial services in underserved communities. This in turn spurs job creation and growth. We are also able to strengthen financial institutions and the development of innovative financial services,” says Jakob Larsson, senior investment manager at Swedfund.

Through FIVE, Swedfund will strengthen the capital base of select financial institutions across Africa, enabling them to grow and reach more clients. The investment also supports FIVE’s commitment to gender equality and women’s empowerment, creating positive change within its portfolio companies and communities. 

By investing in a mix of traditional and digital-first financial service providers, including banks, insurers, and fintechs, Swedfund aims to catalyse more inclusive financial ecosystems, driving job creation and economic growth across the continent.

FIVE stands for Financial Inclusion Vehicle and was established in 2017 by AfricInvest. Other investors include the Norwegian, Danish, Dutch, German and Belgian Development Finance Institutions as well as African multilateral development institutions and pension funds.

Key highlights

• The €110M fund is backed by a diversified pool of renowned investors.
• The fund invests in disruptive, innovative and scalable post-revenue ventures based in, or with a focus on, Africa.
• Since its inception in October 2019, CAIF has backed ten prominent companies operating across the continent in multiple sectors.

The fund is backed by LPs such as EIB, AfricaGrow, FMO, Bpifrance, Triodos Investment Management, Proparco, SIFEM, BIO and, among others, as well as a diverse pool of globally renowned investors, including Development finance institutions, leading multinational corporations, and high-net-worth individuals across Africa and the Middle East as well.

With the close of the fund, the CAIF team will significantly deepen their focus on investing in the most promising early to growth-stage startups improving African lives with disruptive tech-enabled products and services.

With initial check sizes ranging from €1-10M for growth-stage and up to €1M for select seed-stage tickets, the fund invests in startups across multiple sectors, including Fintech, Mobility, HealthTech, EdTech, AI, Digital Content and AgTech.

Since its inception in October 2019, CAIF has backed ten prominent companies operating across the continent, including 54gene, OZÉ, Migo, PalmPay, Heetch, KaiOS, Boomplay, Aerobotics, and WhereIsMyTransport. Most recently, the fund co-led Tunisia-based EdTech startup GoMyCode’s $8M Series A round.

“AfricInvest’s partnership with Cathay Innovation brings to Africa global expertise in the innovation space combined with a robust network in the US and Asia, all helping to build bridges between Africa and the rest of the world, allowing the fund’s investees to grow into regional and global champions.” said Yassine Oussaifi, Partner at AfricInvest and co-head of CAIF.

“As technology scales and brings massive upgrades to global populations, startups are critical in building the new digital infrastructure needed for emerging regions like Africa to redefine industries and society in the 21^st century. We’re proud to partner with the AfricInvest team — connecting the entire African continent with tech hubs around the world — in a shared mission of accelerating the transition to a more digital, sustainable and inclusive economy for Africa and beyond,” added Mingpo Cai, Founder and Chairman of Cathay Capital and Cathay Innovation.

Since its launch in 1994, AfricInvest’s multi-strategy platform has actively contributed to strengthening the private equity and venture capital ecosystem in Africa.

CAIF relies on AfricInvest’s rich investment expertise, its extensive pool of resources from its network and its physical presence across 11 regions through offices including Abidjan, Algier, Cairo, Casablanca, Lagos, Nairobi, and Tunis to provide local hands-on support, create synergies with portfolios and assist with geographic expansion.

With over 200 portfolio companies across 25 African countries in a variety of high-growth sectors, of which 106 have exited, AfricInvest has, to date, raised over $2bn AUM across 21 funds and benefits from strong, long-term support from both African and international investors.

Founded in 2015, Cathay Innovation is a leading venture capital firm providing entrepreneurs with the support of a global ecosystem across North America, Asia, Latin America and Africa.

The global platform unifies technology investment across continents, investors, entrepreneurs and leading corporations to accelerate startup growth with access to new markets, invaluable industry knowledge and introductions to potential partners from the start. With over €2bn assets under management and offices across 3 continents, Cathay Innovation has a strong track record of over 120 global investments, including 19 unicorns, in startups accelerating the sustainable and digital transformation of industry and society.

CAIF enables promising ventures to build and scale innovative technologies that drive inclusive socio- economic growth in Africa.

To date, the fund has proved tremendous traction and scalability with portfolio companies expanding their global footprint to over 21 markets across the continent.

The Fund’s portfolio companies have also aggregated significant impact at scale in recent years with over 136m Africans reached with inclusive and digital solutions–meaning $1 spent reaches more than one user on the continent.

With its current portfolio, the Fund has created and sustained over 1,400 direct jobs, with women representing an average of 35% of the workforce. Deployed by a team of investment professionals located in the centers of VC innovation across Africa, the fund will continue to support African entrepreneurs to scale their innovative technologies across the continent and beyond, as well as support global entrepreneurs in their expansion into Africa.

“The Cathay AfricInvest Innovation Fund was born out of the idea that innovative and tech-enabled startups in Africa are solving important problems and socio-economic gaps. We see this funding opportunity as a means to deliver strategic support to the outstanding startups looking to innovate and improve lives in Africa. Already, CAIF has reached over a hundred million people through job creation and inclusion, but there are still millions across the continent with limited economic resources on our radar,” said Khaled Ben Jilani, Senior Partner at AfricInvest and co-head of CAIF.

The venture capital market in Africa has seen exponential growth over the last decade with the acceleration in digital transformation across all sectors.

As a result, the industry is becoming the fastest-growing innovation ecosystem globally.

In 2021, the ecosystem reached a new milestone of c.$5 billion in venture capital, more than the preceding two years combined and close to three times more than in 2020.

As one of the largest early- to growth-stage Pan-African innovation funds, the final round places CAIF in a solid position to double down its efforts to focus on innovative and scalable post-revenue ventures based in, or with a focus on, Africa.

As a result, CAIF will continue to firmly stand at the forefront of the continent’s rapidly evolving VC scene.

Highlights

• Completed fundraising of $411m, surpassing original hard cap, with contributions from institutional investors, development finance institutions and family offices across Africa, Europe and North America.
• Already closed three deals in Ghana, Kenya and Morocco.
• AfricInvest group has raised $2.0bn+ in funds and invested in over 190 companies across more than 35 countries, since inception in 1994.

Launched two years ago with a hard cap of $400 million, AfricInvest IV received investment from new and returning institutional investors, development finance institutions and family offices from around the world.

The Fund is the largest in AfricInvest’s history and follows on from the previous flagship fund, AfricInvest III, which closed in 2016, reaching a fund size of €272 million (US$300m).

Like its predecessors, AF IV aims to invest in mature and profitable African mid-cap companies across diverse sectors to accelerate their regional growth and deliver attractive risk-adjusted returns. The Fund also supports inclusive and sustainable development, having committed to the 2X Challenge criteria in support of women’s economic empowerment. 

Employing AfricInvest’s signature hands-on approach, the Fund’s investment team offers portfolio companies a unique combination of local insights and global perspectives.

Skander Oueslati, Senior Partner and CIO of sub-Saharan Africa, said: “AfricInvest Fund IV is well-positioned to continue financing African companies, supporting them as they develop into local and regional champions. Our local expertise and insight allow us to generate proprietary deals to help create long-term strategies to deliver value for portfolio companies.”

George Odo, Senior Partner and Managing Director, East Africa, added, “The support we received from our investors has been terrific. Seeing how many of them have recommitted to this mid-cap fund strategy, especially amidst the Covid pandemic, is a testament to their belief in our ability to deliver attractive risk-adjusted returns. We are grateful for their confidence and look forward to partnering as we build a future with the next generation of African entrepreneurs.”

Since its inception, AfricInvest IV has made three investments, the first being the acquisition of a minority stake in Fidelity Bank Ghana in mid-2020. The second, in 2021, was an investment in a merger of Compagnie Marocaine de Goutte à Goutte et de Pompage’s (“CMGP”) with Comptoir Agricole du Souss (“CAS”), creating CMGP-CAS, one of Africa’s leading irrigation and agribusiness companies. 

The most recent investment, in April 2022, saw the Fund, alongside the International Finance Corporation, acquire a 36% stake in Kenya-based AutoXpress, the largest importer, distributor and retailer of tyres, auto parts and accessories in East Africa.

Hakim Khelifa, Senior Partner, commented: “Mid-cap opportunities in Africa will continue to grow. At AfricInvest, we are ready to invest across the continent, engaging management teams directly to further accelerate their goals of building profitable and sustainable businesses while creating long-term impact.”