Regfyl, a Nigerian anti-money laundering (AML) compliance startup, has raised $1.1 million in pre-seed funding to address the growing regulatory challenges facing African financial institutions. The funding round, led by RallyCap Ventures, includes notable investors Techstars, DCG Expeditions, Africa Fintech Collective, Musha Ventures, and several strategic angel investors.

The Growing Need for AML Compliance in Africa

Africa is home to 60% of the countries on the Financial Action Task Force (FATF) 'grey list', indicating a high risk of money laundering and terrorist financing. In Nigeria alone, the Nigerian Financial Intelligence Unit (NFIU) reports that over 90% of fintechs struggle with AML requirements. This lack of compliance poses a significant risk to the stability of the financial system and hinders the growth of the economy.

Regfyl's Solution

Regfyl's co-founders, Dr. Tunde Ibidapo-Obe and Dr. Tomiwa Erinosho, aim to simplify AML compliance for African fintechs and banks. The startup's platform consolidates multiple compliance checks into single API requests, reducing the complexity and cost of compliance. For example, its onboarding bundle combines Politically Exposed Persons (PEP) screening, local and global sanctions list checks, and ID verification. Regfyl claims this approach can cut compliance costs by up to 40%.

African-Centric Approach

Regfyl's AI-powered transaction monitoring system is specifically designed for Africa's financial ecosystem, setting it apart from competitors. "We're not just applying Western models to African problems," Erinosho explained. "Our AI is trained on regional data to detect and prevent fraud unique to our markets."

Early Traction and Future Plans

Regfyl has already gained traction, working with notable fintechs and financial institutions in Nigeria. The company plans to use the new funding to expand its business development, engineering, and customer success teams. With this investment, Regfyl is poised to become a leading player in Africa's AML compliance space.

The Future of AML Compliance in Africa

As the African financial sector continues to grow, the need for effective AML compliance solutions will only increase. Regfyl's innovative approach and African-centric focus make it well-positioned to address this challenge. With the support of its investors and the growing demand for AML compliance solutions, Regfyl is set to make a significant impact in the region.

Regfyl's $1.1 million pre-seed funding is a significant milestone for the startup and a testament to the growing importance of AML compliance in Africa. As the company continues to grow and expand its offerings, it is likely to play a key role in shaping the future of AML compliance in the region. With its innovative approach and African-centric focus, Regfyl is poised to make a lasting impact on the continent's financial sector.