Expanding cross-border payments through stablecoins, Kenya's HoneyCoin attains $4.9 million investment to enter burgeoning markets
In a significant move for the African fintech landscape, HoneyCoin, a Kenyan startup, has secured $4.9 million in seed funding. This brings the company's total capital raised to just over $5 million, including earlier backing from Flourish in 2021 and 2022.
Founded in 2020 in Nairobi, HoneyCoin operates in 15 African countries and other emerging markets, processing approximately $150 million monthly for over 350 enterprise clients and more than 326,000 consumers. The new funding will be used to expand geographically into more African countries, such as Mozambique, Zambia, Rwanda, and Francophone Africa, as well as Latin America and Asia.
HoneyCoin's proprietary AI Matching Engine for netting off flows across both sides is at the heart of its stablecoin-powered payment infrastructure. This system enables same-day settlements at significantly lower costs compared to traditional banking, addressing common issues like delays and high fees in cross-border payments.
The company has received Letters of No Objection (LNOs) from regulators in Nigeria, Kenya, and Tanzania, a testament to its compliance with local regulations. HoneyCoin has also established a global colocation network of strategic banks for near-instant to same-day settlements.
One of the keys to HoneyCoin's strategy is its stablecoin-based instant and same-day settlement rails, which drastically improve transaction speed compared to the typical multi-day settlements in Africa. The company is also integrating directly with diverse financial systems such as banks and mobile money platforms for broader accessibility across the continent.
New products in the pipeline include a Visa-backed stablecoin debit card, a cross-border liquidity solution in partnership with Interswitch, Banking-as-a-Service (BaaS) offerings, and POS software targeted at East Africa. HoneyCoin is also focusing on B2B payments, which make up most of its revenue, by offering payment APIs to corporate clients for seamless integration.
Efayomi Carr, principal at Flourish Ventures, sees HoneyCoin as the go-to infrastructure layer for collecting, converting, and settling funds in any currency across B2B cross-border payments into and within Africa. The company is indeed positioning itself to capture a portion of Africa's $329 billion cross-border payments market.
HoneyCoin is not alone in this mission. It competes with fintechs such as VertoFX, Nala, Yellow Card, and Cellulant. However, its unique approach of combining blockchain stablecoins for liquidity and speed with deep integration into local payment ecosystems could set it apart.
The funding round was led by Flourish Ventures and included participation from TLcom Capital, Stellar Development Foundation, Lava, Musha Ventures, 4DX Ventures, Antler, and Visa Ventures. With this new funding, HoneyCoin is poised to scale its infrastructure and product offerings, shortening settlement times, reducing costs, and enhancing payment efficiency across Africa and beyond.
[1] TechCrunch, "HoneyCoin raises $4.9 million to expand its stablecoin-powered payment infrastructure across Africa and beyond", link
[2] The African Report, "HoneyCoin raises $4.9 million to capture a portion of Africa's $329 billion cross-border payments market", link
[3] Financial Magazine, "HoneyCoin: The Kenyan fintech startup processing $150 million monthly", link
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