Nigerian Debt Collection Startup Bfree Raises 1.7 Million Pre-Series A Funds to Drive Growth and Expansion

Bfree, a Nigerian debt collection startup that leverages ethics and technology to get clients out of debt has secured $ 1.7 million in pre-seed funding to spur growth and expand operations to across Africa and other continents.

4Di Capital, Octerra Capital, VestedWorld, Voltron Capital, Logos Ventures and other angel investors participated in the pre-Series A round of funds. So far, Bfree has raised a total of $ 2.5 million. dollars in funding, including the $ 800,000 raised during a fundraising round in May 2021.

According to the company, the dissatisfied approach to credit collection options and the constant humiliation of customers is one of the problems Bfree solves. Company co-founder and CEO Julian Flosbach said: “Inefficiency and lack of transparency of collections are not unique challenges for digital lenders, nor are they unique to Nigeria. We are seeing important use cases among other customer verticals with digital products such as commercial and microfinance banks, integrated financing solutions, like buy now-pay later, credit cards and even bank payments. ‘taxes at some point. Basically, wherever value is due, our solutions can be deployed. Here we are not just building a solution for Nigeria, but a solution that can potentially be used in all emerging markets with difficult collections infrastructure ”.

Bfree was founded in 2020 by Juliana Flosbach, co-founder / CEO, Chukwudi Enyi co-founder / COO and Moses Nmor co-founder / CPO.

Following the funds raised, Bfree plans to embark on massive recruitment as it expands into new markets in Ghana, India, Uganda, Brazil, Colombia, Mexico, Russia, Poland, in Pakistan and Indonesia.

Speaking on the company’s expansion, Julian said, “We are entering markets with large populations, deep credit, and an underdeveloped regulatory environment, where a behavioral collection approach is likely to work.

“We saw that there was like a small hole in the value proposition of the lenders – they are good at giving loans, but the after-sales services of the credit market did not work because the collection processes were inefficient and unfriendly. “

Bfree currently manages more than 800,000 clients, up from 300,000 clients reported by the company in May 2021.

Yohan Theater, Head of Decision Science and Financial Engineering at Bfree, said: “Lenders in the United States or Europe have the option of selling large chunks of their debt portfolios to third parties. This means that they only bear part of the risk of the loans they issue. In emerging markets, this is generally not the case. Lenders should bear all of the credit risk on their own. A key factor in this difference is higher transaction costs and contractual uncertainties.

“The arrival of DeFi (decentralized finance) is a game-changer: transaction costs can be reduced while contractual security is increased by smart contracts. These are some of the risk sharing instruments that we now actively offer to lenders and borrowers ”.

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