South African fintech firm Stitch has successfully closed a $55 million Series B funding round, spearheaded by QED Investors. This latest infusion of capital brings Stitch's total funding over the past four years to an impressive $107 million, marking a significant milestone for the rapidly growing company. The funding round also saw participation from prominent investment firms such as Glynn Capital, Flourish Ventures, and Norrsken22, alongside existing investors including Ribbit Capital, PayPal Ventures, The Raba Partnership, and Firstminute Capital.

Stitch intends to strategically deploy the newly acquired funds to broaden its in-person payment solutions and further refine its online payment suite. This move is aimed at providing comprehensive payment solutions to enterprise merchants, addressing all their payment-related needs. The company's client roster boasts major names like Takealot, Mr. D, MTN, Vodacom, Standard Bank’s Shyft, TFG’s Bash, Hollywoodbets, Luno, and The Courier Guy, highlighting its significant presence in the South African market.

Gbenga Ajayi, Partner and Head of Africa and the Middle East at QED Investors, expressed enthusiasm about partnering with Stitch, emphasizing the company's visionary founders and its potential to revolutionize the payments industry across Africa and beyond. Ajayi noted Stitch's remarkable growth and execution, transforming into a trusted payment provider with a unique ability to anticipate market needs and execute at scale. He highlighted the company's expansion from a Payment Service Provider (PSP) to a comprehensive payments partner, incorporating robust in-person payments and acquiring solutions.

In January, Stitch introduced Express, a streamlined checkout solution designed for online businesses of all sizes that utilize e-commerce platforms such as Shopify and Woo. The company's payment solutions encompass a wide array of options, including card payments, pay by bank, Apple Pay, Google Pay, Samsung Pay, Capitec Pay, Absa Pay, Nedbank Direct EFT, manual EFT, cash, DebiCheck, 24/7, 365 payouts, and in-person payments. Following its recent funding round, Stitch is now focused on expanding its in-person payments solution, a move that was initiated with the acquisition of ExiPay, a payment solution provider. The acquisition led to the rebranding of ExiPay’s platform as “Stitch In-Person Payments,” tailored for large enterprises managing in-person transactions.

The Stitch team conveyed excitement and pride in their current market position, asserting that they have earned the right to collaborate with clients across various money movement needs, beyond just online or in-person payments. They deemed it the opportune moment to aggressively expand their offerings to better serve their clients. The team also noted that the move into acquiring will enable Stitch to offer clients an end-to-end card product with complete control over the entire product lifecycle.

Co-founded in 2020 by Kiaan Pillay, Natalie Cuthbert, and Priyen Pillay, Stitch, based in Cape Town, is focused on providing full Application Programming Interface (API) access to financial accounts across Africa. CEO Kiaan Pillay noted that within six months of its soft launch in South Africa, the company experienced over 50% month-on-month growth in customer and payment volume across all solutions. Stitch’s unified payment platform facilitates seamless transaction management across multiple financial institutions, simplifying the integration process and allowing businesses to offer diverse payment options, thereby enhancing customer experience and operational efficiency.

Stitch’s API allows developers to connect apps to financial accounts, enabling users to share their transaction history and balances, confirm their identities, and initiate payments. The payment platform includes a data and identity API product and a new payment product, charging developers and companies per API call, similar to other API fintech startups. Additionally, it charges a fixed fee for certain products, such as budgeting or personal finance management apps.

In 2021, Stitch entered the Nigerian market, introducing its payment product, which the company believed had a more compelling use case in Nigeria after engaging with over 40 fintechs. Stitch offered Nigerian businesses free access to the product until the end of that year as part of its branding strategy. Prior to the Series B funding, Stitch raised $4 million in seed funding in February 2021, followed by a $2 million seed extension in October 2021 to support its expansion into Nigeria. In February 2022, Stitch announced a $21 million Series A funding round led by The Spruce House Partnership, with participation from PayPal Ventures and other investors. A year later, the company secured a $25 million Series A extension led by Ribbit Capital, bringing its total Series A funding to $46 million.

Looking ahead, Stitch plans to continue developing its product offerings and expanding its reach within the African payments industry. Stitch's growth and innovation underscore the potential for fintech solutions to address market gaps and improve payment systems across Africa.