In an effort to capitalize on Africa’s increasingly tech-savvy market, Union54, an African start-up supported by Tiger Global Management, is entering the race to develop super apps. The company’s CEO and founder, Perseus Mlambo, announced that their new app, ChitChat, is expected to debut in September. ChitChat aims to provide users with secure messaging and dollar-based virtual cards for international transactions, developed in partnership with Mastercard. Union54 also plans to incorporate payments, gaming, dating, and food delivery services into the platform.
ChitChat will enable users to not only exchange messages but also send money to each other, purchase airtime, and buy bus tickets. Super apps like China’s Alipay and WeChat, as well as Careem in the Middle East, have proven successful in regions with significant unbanked populations. In response, companies such as MTN Group and Safaricom have already introduced similar products in certain African markets.
Union54, initially established as a fintech company in 2021, faced challenges when it encountered charge-back fraud, prompting the suspension of its virtual dollar card service. However, the company has since resolved these issues and is ready to move forward. Union54 has raised $12 million in seed funding through a Y Combinator funding round led by Tiger Global and plans to retain a 40% ownership stake in ChitChat. They also intend to establish partnerships with local companies in the markets they target, beginning with Angola, Tanzania, Uganda, and Zambia.
As cross-border trade within Africa continues to grow, fintech companies and their offerings, including super apps, are expected to thrive. McKinsey & Co. predicts that African fintech revenues could multiply eightfold and reach $30 billion by 2025. Mlambo recognizes the untapped potential in the market and aims to differentiate Union54 by expanding its presence across multiple markets and providing a diverse range of services.