Nigerian fintech startup Bfree is starting the year by celebrating a $1.7 million pre-Series A funding round, according to TechCrunch.

Participating investors include 4Di Capital, Octerra Capital, VestedWorld, Voltron Capital, Logos Ventures, and angel investors. The outlet also reports that $2.5 million has been raised in total, including $800,000 raised in May 2021.

The funds will expand Bfree into additional markets outside its current home in Nigeria and Kenya. The company plans to enter 16 markets in Ghana, India, Uganda, Brazil, Colombia, Mexico, Russia, Poland, Pakistan, and Indonesia.

“We are going into markets with large populations, credit deepening and an underdeveloped regulatory environment, where a behavioral collection approach is likely to work,” Bfree co-founder and CEO Julian Flosbach said, according to TechCrunch.

Bfree's Repayment Services

Founded in 2020 by Flosbach alongside Chukwudi Enyi (COO) and Moses Nmor (CPO), the company hopes to provide ethical solutions backed by technology to improve the repayment rate with digital lenders. 

“We saw that there was like a little bit of a breach in the value proposition of lenders — they are good at giving out loans, but the aftersales services of the credit market didn’t work as collections processes were inefficient and not user friendly,” said Flosbach.

Bfree helps its customers by keeping debt collection standards at the forefront as they work with various defaulters for settlement options. The Nigerian startup works with 30 credited institutions, including digital lenders, microfinance institutions, and banks, TechCrunch reports.

To ensure the optimal collection method is carried out, Bfree forwards customer insights to lenders, and an algorithm helps analyze customer behavior. After further analysis, Bfree can recommend a self-service platform to the customers contingent upon their risk profile.

Bfree also allows its customers to manage various loan repayments with multiple lenders without the hassle of providing various documentation, messaging, and phone calls. What’s more, it’s fast and easy — customers can fulfill a repayment in just about five minutes, according to the company’s website.

What's Next For The Future Of Bfree

Currently, Bfree houses 1.1 million defaulters and boasts 800,000 customers. The company hopes to reach 1.4 million customers by the end of February 2022.

As the company looks ahead, they hope to land services from industry giants Konrad Pawlus and Yohan Theatre to push their mission forward and improve finance options for repayment services using blockchain technology.

“Lenders in the US or in Europe have the opportunity to sell significant chunks of their debt portfolios to third parties. This means they only carry a portion of the risk of the loans they issue. In emerging markets, this is typically not the case. Lenders have to carry the entire credit risk on their own. A key driver for this difference lies in higher transaction costs and contractual uncertainties,” said Theatre, according to Tech Crunch.