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Smile Identity raises $20M to meet the demands of growing ID infrastructure in Africa

Smile Identity
Photo Credit: Smile Identity

With 600M internet users in Africa, there has been an increase in several online frauds and hacking, therefore the relevance of identity verification and Know Your Customer (KYC) cannot be overlooked. 

The surge in investors’ interest in startups offering KYC and identity verification services is itself a sign that strict regulatory mechanisms should come in place so that such frauds can be avoided.

Cashing on that, African KYC onboarding and identity verification platform Smile Identity, which plays an important role in providing ID verification and KYC compliance for African faces and identities has secured $20M in Series B funding.

The funding round was led by Costanoa and Norrsken22 and it saw participation from Commerce Ventures, Courtside Ventures, Two Culture Capital, Valuestream Ventures, Intercept Ventures, Latitude, Future Africa, and 500 Fintech. Lexi Novitske from Norrsken22 will also join Smile Identity’s Board as part of the Series B. This totals Smile Identity’s funding to $31M, including $7M raised in their Series A funding round in 2021.

Tech for identity verification

The Nigerian-based firm stated that the funding will be used to accelerate the development and adoption of its AI-powered identity verification technology, increase hiring in East, Southern, and West Africa with a focus on product and engineering, and expand into new markets, particularly Francophone and Arab-speaking countries.

The company expects that its war chest would enable it to work closely with ID authorities and governments across the continent to develop consumer consent standards and implement local African data protection regulations.

“We believe the majority of people are honest,” said Mark Straub, CEO and co-founder of Smile Identity, “the challenge in the digital age is to prove this, regardless of how a user onboards – whether via agents, apps, tablets, the web, blockchains or paper forms.”  

“We are thrilled to have the support of our partners and investors as we solve this problem across IDs, devices and compliance regimes to ensure Africans are among the most trusted consumers in the world.”

Smile Identity claims to have done 50M KYC checks for hundreds of partners throughout the African continent since its Series A funding round, allowing them to develop their companies by minimising fraud and efficiently onboarding new clients. With its Document Verification product, the company provides global coverage, and it has added a Business Verification or “Know-Your-Business” (KYB) solution to its portfolio.

Furthermore, Smile Identity has grown into South Africa and Uganda, as well as opened offices in London and Cape Town.

“Smile Identity is leading the way in Africa’s digital transformation, providing secure and verifiable identities for millions. Under the leadership of CEO Mark Straub, a top-notch team, and an on-the-ground presence across the continent, Smile is positioned to capture a significant share of Africa’s growing $1.5B identity and KYC market opportunity. By empowering the continent with a foundation for safe transactions, Smile is driving financial service adoption and shaping the digital economy’s future. – Lexi Novitske”.

Smile Identity, which was founded by Mark Straub and William Bares in 2017 and has its headquarters in Lagos, Nigeria, provides firms with digital onboarding, biometric authentication, deduplication and anti-fraud checks, and KYC and Know Your Business (KYB) compliance solutions.

The company uses machine learning technology “built exclusively” for African smartphones, faces, and data to assist businesses verify the identity of their consumers.

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