Smile Identity expands African footprint with acquisition of Appruve to strengthen ID verification services

Smile Identity, a KYC compliance and ID verification companion for a lot of African fintechs and companies, has acquired Inclusive Improvements, the dad or mum firm of Appruve, a Ghanaian developer of identification verification software program. In a press release shared with TechCrunch, Smile Identification mentioned it’s “actively fulfilling regulatory necessities to finalize the transaction … The post Smile Identity expands African footprint with acquisition of Appruve to strengthen ID verification services appeared first on Ferdja.

May 2, 2023 - 21:00
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Smile Identity expands African footprint with acquisition of Appruve to strengthen ID verification services

Smile Identity, a KYC compliance and ID verification companion for a lot of African fintechs and companies, has acquired Inclusive Improvements, the dad or mum firm of Appruve, a Ghanaian developer of identification verification software program.

In a press release shared with TechCrunch, Smile Identification mentioned it’s “actively fulfilling regulatory necessities to finalize the transaction for the [Inclusive Innovation] affiliated entities in Africa.” This strategic acquisition will increase Smile Identification’s footprint throughout Africa and solidify its place because the continent’s main identification verification and digital KYC supplier, part of the assertion learn. Whereas the phrases of the deal weren’t disclosed, sources near the matter say the cash-and-stock deal was “no more than $20 million,” with a big chunk as inventory.

As fintech companies proliferate throughout totally different African markets, the necessity to have enough KYC and identification verification processes in place has intensified amid growing fraud challenges and extra stringent regulatory necessities.

Based by Mark Straub and William Bares in 2017, Smile Identification is a significant participant in Africa’s ID verification and KYC compliance business. Buoyed by enterprise capital funding of greater than $30 million (together with a not too long ago introduced $20 million Collection B) and backed by buyers akin to Costanoa Ventures, Future Africa and Norrsken22, amongst others, the corporate has constructed its enterprise by combining doc verification, face verification, biometrics, and knowledge integrations into native trusted ID authorities to confirm folks’s identities. Different outstanding use instances embody AML checks, buyer onboarding and fraud prevention.

However, Appruve, which supplies an API that verifies consumer identification, fraud detection and digital documentation, primarily focuses on new datasets that allow or complement conventional authorities knowledge akin to worldwide passports and nationwide IDs. Throughout the final 18 months, the four-year-old startup labored on analyzing fraud knowledge from world cash networks, verification of cellular cash monetary statements and blocklist knowledge from varied banks and fintechs throughout the final 18 months. (The four-year-old digital verification upstart has obtained lower than $500,000 in enterprise capital funding since its inception in addition to $450,000 in grant cash from DFS Lab through the Bill & Melinda Gates Foundation, Google’s launchpad studio accelerator, and others.)

“These are related localized knowledge which have lengthy been neglected of the larger pool of KYC and fraud prevention. It’s these capabilities, expertise, and know-how that we’re bringing on board, working along with Smile, which simply launched an AML product, to construct a totally complete product and resolution for the market,” mentioned Appruve founder and CEO Paul Damalie on what his startup brings to Smile Identification’s desk.

Right here’s additionally the way it matches into Smile Identification’s present development technique from a product however geographic-led standpoint. Doc verification and face recognition and matching comprise Smile Identification’s base-level product that works throughout Africa. Whereas the platform has added depth in some markets with extra superior fintech areas, akin to Nigeria, Kenya and South Africa, the place it will probably question in opposition to authorities databases, such depth is missing in different markets, together with Francophone Africa. In a February interview, Straub famous that Smile Identification would use the expansion capital it had secured to increase its KYC capabilities into the market, amongst different issues. Thus, along with supplying Smile Identification with a talented and skilled workforce, APIs and clients, Appruve presents the Costanoa-backed KYC identification supplier with a gateway into the Francophone market (specializing in Ivory Coast and Senegal) and likewise Uganda, Straub advised TechCrunch over a name.

“We’ve product depth in Nigeria already. We’re concerned about replicating the product depth to extra markets and realizing our ambitions to have product depth for all of Africa,” Straub mentioned on the decision. “Fraud knowledge, cellular cash knowledge, authorities knowledge queried in opposition to nationwide ID techniques, AML, PEP screening checks, sanction screening, each world and native KYB enterprise verification knowledge. We need to add that depth in additional markets, and Appruve offers a few of that.”

Smile Identification, based on its assertion, mentioned the Appruve acquisition — which expands its suite of APIs, together with cellular cash, knowledge, and anti-fraud checks — will enable it to “cowl over 1 billion Africans, the African diaspora, and 100 million African companies, supporting over 230 paperwork and knowledge varieties with integration choices for each machine and working system mixture in Africa.” Earlier than the acquisition, Smile Identification had simply crossed over 60 million verifications. In the meantime, Appruve processed as much as 100,000 verifications month-to-month, Damalie disclosed within the interview.

Straub asserts that the mix of Smile Identification and its new subsidiary Appruve alongside the intervention of different KYC and AML companies, will assist lower the potential for fraud regardless of elevated utilization of digital wallets, banking apps, and cellular cash companies throughout the continent. He added that defending shoppers’ knowledge is paramount to Smile Identification’s enterprise, and each Smile and Appruve “have been working diligently to realize and keep the suitable licensing regimes the place required and varied knowledge safety insurance policies.”

Consistent with that, Damalie, who will now head worldwide enlargement efforts for Smile Identification, says, in a few years, the corporate sees itself appearing as “the digital infrastructure that may allow belief amongst African companies” because the intra- and inter-continental motion of products and companies throughout borders turn out to be extra pronounced.”

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