In a strong vote of confidence from regulators and the capital markets, Payaza has received the green light from Nigeria’s SEC to raise ₦20 billion($13.10 million) in its ongoing ₦50 billion($32.68 million) commercial paper programme.
Following FMDQ Exchange’s nod in December 2024, this milestone showcases how a fintech can scale ambitiously without leaning on traditional VC funding.
Payaza’s journey offers a compelling case study for African startups aiming to build a payments empire on their own terms.
Payaza: Rewriting the Fintech Funding Playbook
Founded in 2020, Payaza has carved a niche as a pan-African payment infrastructure provider, offering seamless solutions for collections, disbursements, and white-label services.
Its platform empowers individuals and businesses, particularly SMEs, with reliable cross-border payment capabilities.
But what sets Payaza apart is its approach to funding: instead of chasing VC dollars, it’s tapping into capital markets through commercial papers, a strategy typically reserved for established corporations.
By leveraging commercial papers, Payaza is proving that fintechs can diversify their capital stack and scale without diluting equity, a game-changer for Africa’s startup ecosystem.
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How Payaza’s ₦20 Billion Commercial Paper Works
What Is a Commercial Paper?
A commercial paper (CP) is a short-term, unsecured debt instrument used to raise funds for operational needs, with terms ranging from 15 to 270 days.
Payaza’s ₦20 billion($13.10 million) raise, part of a broader ₦50 billion($32.68 million) programme, will be issued in two tranches, Series 3 and 4, allowing the company to access capital strategically.
“This approach of issuing in multiple tranches is a core benefit of our overall ₦50 billion programme,” Ebenezer explained.
“It allows us to strategically access capital as needed, optimising for market conditions and our specific funding requirements, rather than attempting one massive raise.”
This flexibility, proven successful in Payaza’s Series 1 and 2 issuances, ensures the company can align funding with growth plans while minimising financial risk.
Why This Is a Big Deal
- Market Trust: SEC and FMDQ approvals, coupled with strong investor interest, signal Payaza’s credibility and financial maturity.
- Non-VC Funding: By using commercial papers, Payaza is sidestepping the equity dilution often associated with VC funding, offering a model for sustainable growth.
- Scalability: The tranched structure allows Payaza to raise funds incrementally, aligning with market dynamics and operational needs.
Proving Financial Strength Without VC
Payaza’s ability to secure capital market funding stems from years of building trust and financial discipline.
In June 2025, the company repaid ₦14.9 billion($9.74 million) from its Series 1 commercial paper issuance entirely from operating cash flows, with no refinancing or rollovers required.
This achievement earned Payaza an upgraded ‘A’ rating from DataPro and an investment-grade rating from Global Credit Rating (GCR), an affiliate of Moody’s.
This repayment not only reduced Payaza’s leverage but also positioned it as a reliable partner for institutional investors, challenging the notion that startups must rely on VC to scale.
Payaza’s Plan to Build a Payments Empire
With the ₦20 billion raise, Payaza is doubling down on its mission to transform Africa’s financial landscape. The funds will be deployed across three strategic pillars:
- Infrastructure Growth: Upgrading technology to deliver faster, more secure, and scalable payment solutions.
- Product Innovation: Launching new features to simplify transactions and serve underserved markets.
- Pan-African Expansion: Deepening its presence across Africa to empower SMEs and drive financial inclusion.
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A Blueprint for Africa’s Fintech Future
Payaza’s success comes at a critical juncture for Africa’s fintech sector, which is gaining global traction but faces scepticism about long-term viability.
By embracing commercial papers, Payaza is pioneering a funding model that reduces dependence on VC while fuelling rapid growth.
This approach aligns with growing investor appetite for non-equity funding structures.
Payaza’s model could inspire other fintechs to explore capital markets, diversifying funding options and creating a more resilient ecosystem.
Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, climate change, and digital finance at Africa Digest News.
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