NIGERIA – Flutterwave, a fintech company, has teamed up with US payments giant PayPal to enable PayPal customers globally to pay African merchants through its “Pay with PayPal” feature.

Flutterwave’s integration with PayPal will be operational across 50 African countries and worldwide, it said in a statement.

The collaboration will connect small and medium enterprises with the more than 377 million PayPal account holders globally, Flutterwave said, eliminating the barrier to cross-border commerce.

Online payments got a boost with the Covid-19 pandemic as people rely on mobile apps for shopping and paying bills. Like other companies in the digital payments sector, San Jose, California-based PayPal has profited from the boom in online transactions that pushed more business into the virtual realm.

Flutterwave has said it is positioning to be an African payment platform for multinationals entering new markets.

Founded in 2016 by Nigerians and headquartered in San Francisco, the firm has processed over 140 million transactions.

CEO and co-founder Olugbenga Agboola announced recently that Flutterwave could consider a New York listing after it raised US$170 million from investors to expand its customer base, pushing its valuation up to more than US$1 billion.

Founded in 1998, PayPal was one of the first companies to create the internet’s infrastructure for cross-border payments.  As of 2020, it had 377 million customers in more than 200 countries. Those customers transacted US$936 billion in payment volume in 2020.

The motivation behind this integration with PayPal is to fuel more e-commerce activity in Africa.

Since April 2020 when they launched Flutterwave Store, Flutterwave has channeled energy into enabling online sales for merchants and freelancers in markets where it operates.

The move comes barely a week after Flutterwave announced the close of a US$170 million Series C round which values it as a unicorn. Alongside their unicorn announcement last week, Flutterwave rolled out Flutterwave Mobile.

Flutterwave Mobile is an app created for the small business owner who needs to use their mobile phone as a handy point of sale machine (POS) and online store. Flutterwave merchants can accept payment card payments by generating a link, as well as bank transfers, mobile money, USSD, and now PayPal payments.

The PayPal integration, in particular, opens African SMEs and freelancers up to more international demand.

Until this partnership with Flutterwave, PayPal was not available for people in the diaspora who needed to make payments to African merchants directly.

In 2014, PayPal explored making its services available in Nigeria by offering remittance inflows into the country from the diaspora. But they did not allow merchants in Nigeria to receive payments through PayPal, supposedly due to a perception that online fraud was pervasive.