Grace Ashiru
An African fintech that has built its success on a 30,000-strong team of direct salespeople is steadily expanding its profitability across sub-Saharan Africa. Now, M-KOPA, a pay-as-you-go asset financing platform serving 5 million underbanked Africans, is on the verge of reaching a major milestone: surpassing an annual revenue rate of $400 million by the end of the year.
Headquartered in London, the fintech concluded last year with 4 million customers and $248 million in ARR. This impressive growth is particularly noteworthy given the challenging economic environment. With local currencies losing value against the dollar and inflation eroding consumer purchasing power, sustaining dollarized growth in African markets has been a significant challenge. Despite these obstacles, M-KOPA has not only endured but is thriving.
M-KOPA, an African fintech leveraging a 30,000-strong team of direct salespeople, is making significant strides toward profitability across sub-Saharan Africa. The pay-as-you-go asset financing platform, which serves 5 million underbanked Africans, is on track to surpass an annual revenue rate (ARR) of $400 million by the end of the year.
Headquartered in London, M-KOPA ended the previous year with 4 million customers and an ARR of $248 million. This impressive growth is particularly noteworthy given the challenging economic conditions, including plummeting currencies and inflation squeezing consumer purchasing power. Despite these hurdles, M-KOPA has not only sustained its dollarized growth across African markets but has thrived.
Founded 13 years ago, M-KOPA provides smartphones and other “productive assets” through a flexible digital micropayment system, allowing users to pay daily installments based on the total cost of the item spread across 365 days. The company reports profitability since last year in four countries: Kenya, Uganda, Nigeria, and Ghana. South Africa, where operations began about a year ago, has emerged as its fastest-growing market, according to Mayur Patel, M-KOPA’s president and managing director of fintech, in an interview with TechCrunch.
However, M-KOPA’s rapid growth is not without challenges. The company’s default rates stand at around 10%, which is lower than regional banking averages but higher than U.S. consumer loan benchmarks, raising questions about long-term sustainability. Still, after over a decade in Africa’s expanding credit market, M-KOPA is confident in its model.
“Our loss rates have been remarkably stable over the last four years, even as the company has scaled rapidly and the macro environment has fluctuated. This stability reflects the fact that financed phones are productive assets in people’s lives, enabling everyday earners to generate income and participate in the digital economy,” the company stated.
From the perspective of financial inclusion in Africa, M-KOPA’s achievements are significant. They demonstrate that startups can build profitable business models while addressing the needs of the 90% of adults in Africa’s emerging markets who rely on daily incomes rather than fixed salaries.
Patel attributes the company’s revenue growth and profitability to several factors, including improved pricing strategies, expansion into higher-value markets with stronger local currencies like South Africa, and the addition of 1 million underbanked individuals to its customer base in the past six months.
The company has achieved further success by maintaining high levels of customer compliance with payment plans, averaging approximately 12 repayments per second. This reliability has enabled M-KOPA to upsell and cross-sell higher-value products, including microloans, electric bikes, data bundles, and health insurance, based on customer repayment histories. Similar services are also offered by companies like MAX and Tugende.
“We’re proud of the continuity of the business,” the former chief commercial officer commented. “It took us eight years to acquire our first million customers. Now, we’ve just onboarded our fifth million in just over six months. The business is clearly on a very strong scale-up trajectory.”
The surge in user growth is being driven by M-KOPA’s strategic optimisation of its sales and distribution network. According to Patel, the fintech now operates the largest direct sales force in Sub-Saharan Africa, comprising more than 30,000 active agents. These agents work within their local communities, going door-to-door to sell financed phones, thereby providing access to products that might otherwise be out of reach for many individuals.
M-KOPA, an African fintech powered by a 30,000-strong team of direct sales agents, is steadily achieving profitability across sub-Saharan Africa. The pay-as-you-go asset financing platform, which serves 5 million underbanked Africans, is closing in on a significant milestone: surpassing an annual revenue rate (ARR) of $400 million by the end of the year.
Headquartered in London, M-KOPA ended last year with 4 million customers and an ARR of $248 million. This leap is particularly impressive given the challenging economic climate, where currencies have depreciated against the dollar and inflation has squeezed consumer purchasing power. Despite these hurdles, M-KOPA has not only endured but thrived in its mission to maintain dollarized growth in African markets.
Founded 13 years ago, M-KOPA provides smartphones and other “productive assets” through a daily payment model, where users pay in installments spread across 365 days. Since last year, the company has achieved profitability in four countries: Kenya, Uganda, Nigeria, and Ghana. South Africa, which it entered a year ago, is currently its fastest-growing market, according to Mayur Patel, the company’s president and managing director of fintech, in an interview with TechCrunch.
However, M-KOPA’s growth is not without challenges. Default rates hover around 10%, slightly lower than regional banking averages but higher than U.S. consumer loan benchmarks, raising concerns about long-term sustainability. Yet, after over a decade in Africa’s evolving credit market, the company remains confident in its model.
“Our loss rates have been remarkably stable over the last four years, even as the company has scaled rapidly and faced macroeconomic changes. This reflects the value of financed phones as productive assets that help everyday earners generate income and participate in the digital economy,” the company said in a statement.
From a financial inclusion perspective, M-KOPA’s metrics are significant, demonstrating that startups can create profitable models while addressing the needs of the 90% of adults in Africa’s emerging markets who earn daily incomes instead of fixed salaries.
Patel attributes the company’s revenue growth and profitability to improved pricing strategies, expansion into higher-value markets with stronger local currencies like South Africa, and reaching an additional 1 million underbanked individuals in just the past six months.
The company’s success is also linked to its customers’ ability to meet payment plans—averaging around 12 repayments per second—and its upselling of higher-value products such as microloans, electric bikes, data bundles, and health insurance based on consumer repayment trends. Other companies like MAX and Tugende provide similar services.
“We’re proud of the continuity of our business. Acquiring our first million customers took eight years, while onboarding our fifth million took just over six months. The business is now on a strong scale-up trajectory,” said Patel, a former chief commercial officer.
This rapid user growth has been bolstered by M-KOPA’s optimisation of its sales and distribution network. The company now operates the largest direct sales force in sub-Saharan Africa, with over 30,000 active agents who go door-to-door selling financed phones in their communities. These agents also set up payment schemes on the devices and collect initial deposits.
Four years ago, M-KOPA’s sales force consisted of just 3,000 agents. Today, this extensive network, combined with the company’s move into smartphone assembly, has significantly boosted its smartphone sales. Since launching its Nairobi-based assembly plant—the largest of its kind in sub-Saharan Africa—mid-last year, M-KOPA has sold over 1.5 million X-Series branded smartphones, which provide access to embedded digital services from third-party providers.
M-KOPA’s journey began with solar power systems, which it sold over one million units of as of last year. However, the company has since phased out this product line to focus on electric vehicles and leverage its operational expertise to establish smartphone assembly operations.
“Solar remains a core part of our DNA and enabled us to venture into smartphone assembly—a rare move for fintechs. Our experience refurbishing solar-powered TVs and similar products gave us the operational expertise to establish our assembly plant. While we’ve phased out solar lighting, we’re directing efforts toward electric vehicles, which hold significant promise,” said Patel.
In sub-Saharan Africa, where 85% of the population earns less than $10 daily and lacks financial profiles or collateral, accessing credit is nearly impossible. M-KOPA’s daily payment model helps customers build credit histories over time. Smartphone customers pay an upfront fee of $25 to $30, followed by daily payments of 50 to 60 cents over 12 months. Higher-value products, such as electric bikes, offer buyers economic benefits, with customers saving approximately 30% of their daily income by using them.
The company’s financing model underscores its impact on expanding Africa’s credit market, backed by the $1.5 billion in cumulative credit it has deployed. Supported by investors like Sumitomo, Standard Bank, and various development finance institutions, M-KOPA raised $250 million last year, including $200 million in debt financing. It secured an additional $15 million in debt earlier this year. While it remains unclear if M-KOPA plans to raise an equity round—potentially propelling it into unicorn status—its $400 million run rate cements its position among Africa’s largest fintechs by revenue.
“Over the past decade, our journey has been about finding innovative ways to better serve our customers, reduce costs, and deliver exceptional value,” Patel remarked. “The broader narrative, however, revolves around emerging markets and everyday earners. In these markets, successful companies are those that master a sophisticated approach, combining a cutting-edge, world-class online technology stack with outstanding offline distribution and operational capabilities.”
