Wave Mobile Money secures US$91m investment from IFC

WEST AFRICAIFC has announced a US$91.6 million investment agreement in Wave Mobile Money S.A. (Senegal) and Wave Côte d’Ivoire S.A., two major mobile money service providers in their respective markets, to strengthen financial inclusion and support economic growth in Senegal and Côte d’Ivoire.

The funding from the IFC and other investors will allow Wave to expand its operations in Côte d’Ivoire and Senegal, as well as its product offering and customer base. It will also help in lowering the prices of these services in West Africa.

IFC negotiated finance of US$91.85m, comprising a US$25.51m loan from IFC for its own account, US$41.84 million loan from Symbiotics, Blue Orchard, responsAbility, and Lendable, and US$24.49 million parallel loans from Finnfund and Norfund.

The collaboration between IFC and Wave will allow them to respond to the rapid surge in demand for digital payments and mobile money services in West Africa, which has been exacerbated by the COVID-19 outbreak.

“Wave’s vision of making Africa the first ‘cashless’ continent by offering affordable and user-oriented solutions corresponds to the IFC’s ambitions for universal financial inclusion,” said Coura Sène, regional manager of Wave Mobile Money for the area covering the Union West African Economic Community (UEMOA).

“This investment from IFC and other partners will enable us to offer a wide range of financial products, encouraging consumers to remain in the formal financial system and promoting financial inclusion in the region.”

However, access to digital financial services in the region remains low, with only 24% of active mobile money accounts, compared to 34% in East Africa in 2020.

Wave Senegal presently has over 6 million active users, and fintech has recently added bill payments, merchant payments, and more bank-to-wallet transactions.

IFC’s aim is to expand access to financial services for low-income communities who are not banked,” said Aliou Maga, IFC’s Regional Director for West and Central Africa.

“Our investment in Wave will not only create a more inclusive financial sector, but will also significantly aid in the development of digital solutions in West Africa.”

In addition to financing the operations of the two companies, IFC’s assistance will aid in the creation of an environment conducive to the development of mobile services money in the region, thanks to Wave’s service offering, which is distinguished by a simpler pricing grid and lower transaction costs.

This should boost transaction frequency and value while also encouraging new types of use, particularly among low-income clients.

Wave’s drastically low-cost strategy, which costs only 1% for transfers and allows customers to make free cash deposits and withdrawals, has already impacted the markets of several WAEMU countries, with competitors following suit and decreasing rates — to the benefit of consumers.

Wave saw significant rates of customer uptake and retention in Senegal and Côte d’Ivoire, actively contributing to both nations’ national financial inclusion and digital economy objectives.

IFC funded US$5 million in Wave Mobile Money Holdings Inc. in September 2021 as part of a co-investment with Partech Africa. Over the last six years, IFC has invested or raised more than US$1.25 billion in the African innovation sector from other investors.

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