Regfyl, a Nigerian anti-money laundering (AML) compliance startup, has raised $1.1 million in pre-seed funding to address the growing regulatory challenges facing African financial institutions. Notable investors include Techstars, RallyCap Ventures, DCG Expeditions, Africa Fintech Collective and Musha Ventures, and a number of strategic angel investors.
Co-founders Dr. Tunde Ibidapo-Obe and Dr. Tomiwa Erinosho aim to simplify AML compliance for African fintechs and banks. The startup's timing is opportune, as 60% of the countries on the Financial Action Task Force (FATF) 'grey list' are in Africa. In Nigeria alone, the Nigerian Financial Intelligence Unit (NFIU) reports that over 90% of fintechs struggle with AML requirements.
"African financial institutions are caught between rapidly evolving regulations and the need for efficient operations," Ibidapo-Obe said. "We're building a bridge to help them navigate this complex landscape."
Regfyl's platform consolidates multiple compliance checks into single API requests. For example, its onboarding bundle combines Politically Exposed Persons (PEP) screening, local and global sanctions list checks, and ID verification. The company claims this approach can cut compliance costs by up to 40%.
The startup's AI-powered transaction monitoring system, specifically designed for Africa's financial ecosystem, sets it apart from some competitors. "We're not just applying Western models to African problems," Erinosho explained. "Our AI is trained on regional data to detect and prevent fraud unique to our markets."
Early traction looks promising, with Regfyl already working with notable fintechs and financial institutions in Nigeria. The company plans to use the new funding to expand its business development, engineering and customer success teams.
September 17, 2024
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