Top KYC startups in Africa (2023)

Top KYC startups in Africa

Get to Know Your Customer (KYC) – a vital procedure for African businesses aiming to thwart fraud and adhere to regulations. Lately, there’s been a notable surge of KYC startups across the continent, adopting cutting-edge technology to enhance both efficiency and security.

In this article, we’ll delve into the leading KYC startups in Africa for the year 2023. We’ll delve into their ingenious solutions, target markets, and prospects for growth. Moreover, we’ll provide a glimpse into what the future holds for KYC in Africa.

With the African KYC market experiencing rapid expansion, the World Bank approximates that more than 1.2 billion individuals on the continent lack formal identification. This substantial gap presents a remarkable opportunity for KYC startups to offer businesses a means to accurately verify the identities of their customers.

By leveraging a diverse range of innovative technologies such as facial recognition, document verification, and blockchain, A3Techworld confirms that the top KYC startups in Africa are revolutionizing the process to be more efficient and secure. For a similar post, read our comprehensive article on the Top Fintech companies in Nigeria.

The horizon appears promising for KYC in Africa. As the digital economy continues its growth trajectory, the significance of KYC will only escalate. Positioned advantageously, the foremost KYC startups in Africa are poised to seize the opportunity and capitalize on this burgeoning demand.

List of the top KYC startups in Africa

Here is the list of the top KYC startups in Africa:

1. Smile ID (Smile Identity)

In the past, operating under the name “Smile Identity” Smile ID offers a seamless way to verify IDs from a distance within mere seconds, all while ensuring compliance and effectively combatting fraud on a large scale.

Established in 2017 by Mark Straub and William Bares, this Nigerian-based startup has garnered substantial support, raising total funding of $31.1M through five rounds since its inception.

Smile ID provides an array of solutions, including document verification, AML checks, government check, biometric authentication, business verification, fraud prevention, bank account verification, and phone number verification, catering to various verification needs.

In the previous year, the company successfully concluded a Series A funding round, securing a substantial $7 million investment. The funding came from a diverse group of investors, including Costanoa Ventures, CRE Venture Capital, LocalGlobe, Intercept Ventures, Future Africa, Khosla Impact, ValueStream Ventures, Beta Ventures, 500 Startups, Story Ventures, and several angel investors.

With total funding of over $11,000,000 up to this point, Smile Identity now caters to more than 250,000,000 identities and provides verification for 15 different ID types. The company performs an impressive one million identity checks each month.

The platform is widely adopted by various companies, including payment giants like Paystack, Paga, and Chipper Cash, as well as emerging neobanks like Kuda and Umba. Traditional banks such as Stanbic IBTC, prominent cryptocurrency exchanges like Binance, Luno, and Paxful, and supply-chain businesses like Twiga also rely on Smile Identity for their ID verification needs.

2. iiDENTIFii

iiDENTIFii, a South African company, harnesses the power of technology to securely authenticate physical identities in real time.

Through an advanced system utilizing biometrics, facial verifications, and data validation, iiDENTIFii ensures robust and secure triangulated authentication.

The company’s dedication to excellence has earned it prestigious accreditations from renowned organizations, including the National Institute of Standards and Technology (NIST), ISO, GDPR, Whistle Blowers, Risk X, and the Information Commissioner’s Office (ICO).

In a significant milestone, iiDENTIFii was selected as Endeavor Entrepreneurs in July of the previous year, making it the first South African team to join Endeavor in 2021. Acknowledging their outstanding contributions, the company received numerous awards, notably the Best Enterprise Solution at the 2021 MTN App of the Year awards for its biometric digital authentication and automated onboarding solution.

3. VerifyMe

In 2013, Olutunji Oluwole laid the foundation of VerifyMe, initially focusing on biometric enrolment and data capture solutions. However, in 2017, they expanded their services to include identity verification after obtaining a relevant license. Presently, under the leadership of Esigie Aguele, this startup has successfully secured a total funding of $5 million.

VerifyMe stands as Nigeria’s most rapidly growing identity verification company, achieving a remarkable 10-fold growth in the year 2021. Setting itself apart from the competition, the company became the first to gain direct access to essential government data sources like the Nigerian Identity Management Commission (NIMC), Central Bank of Nigeria (CBN), Bank Verification Number (BVN), and Federal Road Safety Commission (FRSC). Their innovative service, Verifind, holds the distinction of being the country’s most robust location solution.

By incorporating cutting-edge 4D GIS geotagging technology and deploying a vast network of over 30k last-mile verification agents across the nation, VeriFind has successfully completed over 700k address verifications since its launch in 2020. As a result, VerifyMe has earned a reputation for being a trustworthy provider of driver’s licenses and comprehensive KYC infrastructure, facilitating seamless interoperability of KYC data across various industries and employers. Their services also empower Nigerian companies to make informed hiring decisions, promote transparency, and foster accountability among their workforce and customers alike.

4. Identitypass

Founded in 2021 by a trio of visionaries, namely Lanre Ogungbe, Niyi Adegboye, and Tolu Adetuyi. Since its inception, this dynamic KYC startup has managed to secure an impressive $3.1 million in funding.

IdentityPass takes a proactive approach to safeguarding both individual and business identities, offering robust protection against potential ID thefts. Moreover, the company’s cutting-edge solutions aid brands in streamlining their customer onboarding procedures, ensuring a seamless and secure sign-up and verification experience.

Catering to a diverse range of industries, including FinTech, Insurance, Mobility, E-commerce, HR management, Cryptocurrency, and more, this Nigerian startup is making waves. Currently, IdentityPass operates in multiple African countries, including Nigeria, Kenya, Ghana, and South Africa.

5. Youverify

In 2017, Gbenga Odegbami and Suru Avoseh co-founded Youverify in Lagos. This innovative startup has successfully secured $2.5 million in funding since its inception.

Youverify stands as a pioneering force in the field of Identity verification and Data management. By delivering cutting-edge KYC and AML solutions, the company empowers businesses to streamline compliance decisions. Through these solutions, enterprises can efficiently onboard customers, employees, and partners, while effectively combating fraud using comprehensive data.

Among the array of services provided by Youverify are identity verification, address verification, background checks, know your customers, know your business, know your employees, know your transactions, workflow automation, fraud detection, and transaction monitoring.

6. ThisIsMe

ThisIsMe, a dynamic South African startup, has developed cutting-edge software enabling users to securely verify their identities. With its sights set on global outreach, the company has successfully ventured into Australasia and Southeast Asia, while eagerly eyeing opportunities in Europe and other regions across Africa.

Since its inception in 2014, ThisIsMe has been empowering users to authenticate their identities and confirm their existence, effectively combating identity theft and fraud. The company takes particular interest in ensuring compliance with the Protection of Personal Information Act (POPI) and the Financial Intelligence Centre Act (FICA), especially in the financial sector.

Having recently secured an impressive US$2.5 million in funding, ThisIsMe is all set to embark on its expansion journey. The company envisions a bright future, planning to bolster its team, move into a larger office space, and forge its presence on a global scale. As ThisIsMe continues to innovate, it remains committed to delivering top-notch identity verification solutions to clients worldwide.

7. BACE Group

Introducing BACE Group – a trailblazing tech firm that’s all about advancing AI-driven identity verification solutions across Africa. At the heart of their innovation lies their flagship product, BACE ID – a cloud-based marvel wielding facial recognition, OCR, and other AI marvels to ensure customers’ and users’ identities are legit.

Foster Ofuso and Eric Nti birthed this visionary enterprise back in 2017, planting their headquarters in Accra, Ghana, while branching out with offices in Nigeria, Kenya, and South Africa. Funding worth $1 million plus from prestigious backers like the Royal Academy of Engineering and the African Development Bank has propelled BACE Group to soaring heights.

In the vast African landscape, BACE Group’s solutions find purpose in various sectors – from banks and telecom companies to thriving e-commerce platforms. Their overarching goal? To weave a digital realm of trust and security that Africa can wholeheartedly embrace.

8. Seamfix

Seamfix, a tech company based in Lagos, specializes in providing cutting-edge technological solutions for identity management, automation, and other areas, ultimately fostering business growth and enhancing customer satisfaction.

Their unique approach involves offering a biometric data capture platform as a service, streamlining biometric enrollment projects to ensure smooth implementation.

Having received certifications from respected entities like the International Organisation for Standardisation (ISO), National Identity Management Commission (NIMC), Nigeria Inter-Bank Settlement System Plc (NIBSS), and General Data Protection Regulation (GDPR), among others, Seamfix’s reputation extends beyond the African continent.

In 2019, the London Stock Exchange Group (LSEG) acknowledged Seamfix as a leading provider of identity management solutions.

9. OkHi

In Nigeria’s recent tech scene, OkHi, an impressive startup from Kenya, has emerged as a notable player. Their intelligent addressing system has revolutionized the way businesses gather precise customer addresses effortlessly, ensuring seamless navigation and digital verifications.

The real beauty lies in the simplicity of conducting these verifications through a smartphone, eliminating the hassles of manual processes. This versatility extends to various sectors, including health, education, and the food industry, among others.

With formidable backing from Interswitch, Google, Betatron, and Founders Factory Africa, OkHi has successfully secured funding of over $2,000,000. Their primary goal is to promote financial services inclusion throughout the African continent.

The Importance of KYC in AML Compliance in Africa

The Importance of KYC in AML Compliance in Africa

Throughout 2021, a staggering $2.7 billion in fines for anti-money laundering (AML) failures were imposed on over 80 financial institutions worldwide. Each firm, on average, shelled out $34,151,237, highlighting a common flaw in its customer verification process that can be exploited for fraudulent and illicit financial activities.

Even in Africa, prominent financial institutions like Access Bank Nigeria and GTBank faced substantial penalties for breaching AML and counter-terrorist financing (CTF) laws at different points in time, further emphasizing the crucial nature of AML and CTF compliance.

While Know Your Customer (KYC) checks are frequently associated with financial institutions such as banks, it’s essential for virtually all businesses involved in making payments or hiring third-party companies for payments to adopt a robust KYC process. Whether it’s brokers, private payment platforms, fintech tools, or wire transfers, incorporating KYC into their onboarding and monitoring procedures becomes imperative.

Keeping up with Know Your Customer (KYC) procedures is an ongoing commitment for businesses. Regularly reviewing and updating these procedures is vital to ensure their effectiveness. Staying informed about the latest Anti-Money Laundering (AML) regulations and adopting best practices empowers businesses to safeguard themselves against financial crime and uphold their reputation.

If your business is yet to achieve AML compliance, I strongly encourage you to take the necessary actions to get started. There are abundant resources available to assist you, such as the Financial Action Task Force (FATF) website and the AML Compliance Toolkit provided by the World Bank.

Taking steps to adhere to AML regulations not only fortifies your business against financial crime but also bolsters your reputation. Thank you for taking the time to read this.

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