Stitch, a fintech company based in Cape Town, South Africa, has secured $25 million in an extension round of funding with leading global fintech investor, Ribbit Capital, as the primary investor.
This round has increased Stitch’s total Series A funding to $46 million with continued participation from existing investors such as CRE Ventures, PayPal Ventures, and the Raba Partnership.
Stitch, which launched its first payment product two years ago [2021], is currently processing over 50 million payments annually, and over $2 billion in value, for some of the largest businesses operating in South Africa, including:
- MTN
- Multichoice
- The Foschini Group (TFG)’s Bash
- HollywoodBets
- LottoStar
- Luno
- Yoco
The company, which has over 80 employees, has gone from a single-method (Pay by bank) provider to an end-to-end payments solution provider with eight pay-in methods, it says.
These offerings includes comprehensive pay outs capabilities and a robust payments management platform (PayOS), enabling payments orchestration and reconciliation via a single application. PayOS works as well for Stitch methods as it does for other providers and methods.
“We moved away from being a single method platform to a next-generation PSP for local and global enterprises,” said Co-Founder and CEO, Kiaan Pillay, who founded Stitch with Natalie Cuthbert and Priyen Pillay.
“Initially, we just had a pay-in feature where we support bank and card payments. While we’ve added more, we now have an orchestration layer, which many enterprises use to manage payment methods and reconcile across different banks. And we do payouts, whether a disbursement, a refund, or a withdrawal. Our solution is attractive for global companies trying to enter the market for the first time because of the end-to-end process.”
While Stitch has been focusing on enterprise clients for the better part of its two years, it recently introduced a solution for SMEs called WigWag, a social commerce payment platform designed to empower small businesses by enabling them to accept digital payments through a distinctive payment link.
According to Stitch, WigWag is a simplified, no-code version of the enterprise product that’s designed specifically for SMEs without access to developer teams or even a website.
“While we’re looking forward to expanding into new markets, we’re also doubling down on our commitment to South Africa. We believe this is one of the most dynamic and unique markets in the world, and we’ve only just scratched the surface in terms of its potential,” Stitch said.
Some of the reasons that make South Africa a favorable market according to Stitch include:
- A highly banked population, especially when compared with other emerging economies
- A burgeoning open banking ecosystem
- A significant population size with a high level of internet and mobile penetration
- A significant number of established enterprise businesses
- A welcome environment for international players looking for a launchpad on the continent
“Our investors have either started or backed the most prolific and successful fintech businesses – and we are benefitting from the lessons they’ve learned along the way. We’re excited to add our latest investors to this roster and look forward to achieving more growth, together.”
