Gozem secures $10m from IFC to finance 6,000 vehicles in Togo and Benin

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Published: 2022-06-15
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12 million.

According to Gozem, a super app with a focus on Francophone Africa, this is the projected number of drivers who operate motor vehicles in informal markets in West and Central Africa. But there's a catch: these drivers can't get financing for their cars through conventional banks or microfinance organizations since they don't have access to those kinds of institutions. They rely, rather, on moneylenders who charge absurd interest rates; some of these lenders charge as much as 70 percent yearly interest on loans.

Gozem, a company that offers a suite of mobility, e-commerce, and financial services to drivers, retailers, and other consumers, made the announcement on Friday that it has partnered with the International Financial Commission (IFC) to solve these problems for drivers. Gozem provides a suite of mobility, e-commerce, and financial services to drivers, retailers, and other consumers.

The Gozem car financing project has received a commitment of $10 million in investment capital from IFC. Because of this investment, Gozem will be able to provide customers in Togo and Benin, two of its operating markets, with access to inexpensive auto financing.

This transaction takes place approximately 6 months after Gozem successfully concluded a funding round of $5 million and approximately 14 months after the company launched its vehicle lending program. According to the company, it has already assisted over 2,000 drivers in acquiring vehicles by providing them with inexpensive financing. Because to this new cooperation, an additional 6,000 drivers will be able to purchase new vehicles.

Gregory Costamagna, co-founder and co-CEO of Gozem, made these comments in a statement: "Motor vehicle drivers in West and Central Africa will need access to $3 billion of credit facilities annually to finance their vehicles. We are excited that IFC is placing their trust in Gozem to be at the forefront of providing affordable financing solutions to these underserved communities."

Gozem makes use of drivers' data that is already available on its platform, in contrast to traditional financial institutions that demand a credit history, asset collateral, or guarantors before issuing loans and third-party lenders who charge exorbitant interest rates that are only expected to rise in the future. This service is made available by the company by utilizing what Costamagna refers to as its "sophisticated" KYC process, as well as financial and behavioral data, such as the number of trips completed using the company's app (which can be accessed in a matter of minutes), to determine the credit worthiness of drivers. This relieves drivers of the responsibility of keeping track of their bank statements and records; merely by using the app to find riders and gigs, Gozem is aware of how much money drivers make and approximately how long it will take for riders to pay them.

Gozem stated in a statement that was sent to TechCabal that they will also work with the IFC to test electric bikes in motovehicle operating conditions over the course of the next year. Additionally, they plan to "build a green battery-swapping station network in Togo and Benin to demonstrate electric bikes can save drivers money."

Raphael Dana, Costamagna's counterpart as co-founder and co-CEO of Gozem, told TechCabal over the phone that IFC is beginning a pilot investment to test the impact and scalability of this model, and that IFC will double down based on the result of the pilot. Dana is Gozem's co-founder and co-CEO. Costamagna is Gozem's counterpart as co-founder and co-CEO.

He went on to say that this collaboration takes into account electric automobiles as well ( EV). Our electric vehicle (EV) pilot program will receive ten percent of the total expenditure we made. According to him, "there is a dedicated team working on our electric vehicle vision, and we need to ensure that the bikes, battery switching, economic units, and other things function at scale."

Gozem launches in Cameroon, its second market in Central Africa

According to a statement released by the firm, the experiment will "verify electric bikes and that their adoption at scale would not only reduce greenhouse gas emissions dramatically, but it will also help drivers save money through lower energy and maintenance expenses." [Citation needed]

" The ability to say anything is in the hands of electric automobiles. IFC's Regional Director for West and Central Africa, Aliou Maiga, emphasized that electric vehicles have the potential to "transform the moto-taxi market in West and Central Africa by lowering carbon emissions and lowering operating costs for drivers." Maiga was speaking about how EVs have the ability to "transform the moto-taxi market in West and Central Africa." She stated that if they collaborated with Gozem, they would be able to "increase inexpensive and green financing solutions for moto-taxi drivers to change to electric bikes." This would be possible thanks to the partnership.

" We expect that IFC's investment for these underserved regions would motivate other investors and expedite the eradication of poverty as well as emissions of greenhouse gases in these markets," she continued.

In recent times, there has been a discernible increase in the number of initiatives that pertain to access financing. The previous year, Asaak entered into a relationship with Untapped Global to provide funding for the purchase of 2,000 bicycles in Uganda, including both electric and fossil-fuel powered bicycles. Untapped Global has also engaged into a collaboration with South African Flexclub that was very similar to the one described above.

Untapped Global partners Asaak to finance 2,000+ motorbikes in Uganda

Looks like Gozem is gearing up for some huge funding. As the business gets ready to enter new markets like Nigeria, the Democratic Republic of the Congo, and Senegal, Dana stated in March that the organization was looking to raise $80 million for its Series B round of funding. This would be broken down as follows: $50 million in equity, $20 million in debt, and $10 million for the pre-series B round.