OkHi, a Nigerian company helping banks, fintechs and businesses collect and verify the addresses of customers via their smartphones, has raised a seed extension round of $1.5 million. In total, the company has raised $3 million in seed funding. The round saw the participation of new investors Chapel Hill Denham, Olugbenga Agboola of Flutterwave and EXFI, who join existing backers such as Founders Factory Africa, Betatron and Interswitch Group.
In African countries, especially Nigeria, it is quite a huge challenge to adequately collect information regarding the address of people as a result of the poor infrastructure in place for that. And information such as this is important to access financial services such as setting up a bank account, asking for a loan, etc.
The conventional method of collecting this information is by requesting utility bills, which can easily be “borrowed” from friends and family members and undermines the purpose for the data collection, or sending agents to confirm the physical address of customers which has a cost implication attached to it.
OkHi wants to achieve the same goal or purpose but with technology. Research the company conducted showed that 78 percent of its sample was required to prove their address before they can get a job. It also added that while about 57 percent of people said that they found it hard to verify their addresses in some circumstances, about 50 percent did not have a utility bill.
The company, which claims to be the only smart address verification service with a smartphone feature in the world, was founded in 2014 by Timbo Drayson. He once worked as a product manager at Google and was a member of the team that launched Google Maps across Europe, the Middle East and Africa. The idea for OkHi came from the addressing challenge faced while he worked on Maps in Africa. He decided to solve this problem and that was how OkHi came about. According to him, this wasn’t just a problem for Nigerians, it was also a global issue. “The problem that I was experiencing firsthand, whether it was trying to get a delivery, then from Jumia, in its early days, or whether it’s just trying to register for a SIM card, everyone was asking for an address, and there’s no way for me to give an address. And I realised that this was a huge problem, not just for every Nigerian, but also for half the world,” he said. According to him, over 4 billion people globally do not have a formal physical address and this costs the global economy more than $200 billion annually. His company’s goal is therefore to include this overlooked group of people in the global address system.
OkHi is, however, starting with building for financial services as institutions such as banks that need to verify the addresses of their customers before they give them access to financial services.
OkHi’s service is integrated into a mobile banking app or a fintech’s application, thus allowing them to collect and verify the addresses of customers. The platform works by using location data from a person’s phone and verifies how long the person spends at specific location to verify addresses. Once verified, this data can be used across financial institutions partnering with the platform.
The platform charges its client the sum of N500 on every successful verification of customers’ address. The company is looking at partnering with 15 other financial institutions including banks and fintechs. It also has long-term plans of diversifying its client base. While it wasn’t specific on its user number, it says it has hundreds of users. Its target is to get to 1 million users in Nigeria in the next six months.
Bolaji Balogun, CEO of Chapel Hill Denham, will be joining OkHi’s board as part of the company’s investment.