South African payments and software platform Yoco has secured $83m in Series C funding, bringing its total funding raised so far to $107m.

Dragoneer Investment Group, Breyer Capital, HOF Capital, The Raba Partnership, 4DX Ventures, TO Ventures as well as a number of current and former executives from fintech firms including Revolut, Coinbase, Spotify and Gojek participated in the round.

The round was also joined by existing investors Yoco investors Partech, Velocity Capital Fintech Ventures, Orange Ventures and Quona Capital.

According to Yoco CEO Katlego Maphai, the latest fundraising reflects the growth potential of the African small business sector.

Maphai said: “We are excited to partner with such world-class investors who have joined our quest to break barriers and create access to financial services for millions of small businesses across the continent.

“Looking ahead, this investment will unlock capacity for us to accelerate product development for our merchants and continue on our growth trajectory in South Africa and beyond.”

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By GlobalData

Yoco attributes its growth to small, independent businesses that were earlier cash-only owing to the complexity and high costs of alternatives.

The firm claims to be a preferred payments partner for more than 150,000 small businesses in South Africa. It is said to process over $1bn in card payments annually.

Growth Plans

Yoco, which currently offers online and in-store payments, is targeting to reach at least a million merchants within the next four years.

The latest capital infusion will support the firm’s plans to accelerate the development of its financial ecosystem for small businesses.

The firm also eyes expansion beyond South Africa, into the Middle East and across Africa in the next two years.

Besides, Yoco plans to hire 200 people within the next year to support its growth trajectory.

Commenting on the development, Yoco chief business officer Carl Wazen said: “There are over 6 million small businesses in South Africa and well over 100 million across the Middle East and Africa that still transact only in cash.”

Wazen noted that the recent consumer behaviour indicates a shift away from cash, pushing businesses to rapidly adapt to this change.

“This presents a huge opportunity and it is our mission to support that transition,” he added.

Last month, digital payments provider ACI Worldwide extended its partnership with South Africa’s Pick n Pay to drive payments modernisation.