Nigeria’s escrow fintech company, Escrowlock, has received an undisclosed amount of funding from Facebook. Escrowlock is one of 30,000 tech companies that secured a portion of the $100 million grant from the social media giant.
The grant will be received as a mix of cash and Facebook advertisement credits. The startup was founded by Elochukwu Ezenekwe in Anambra State and serves as a middleman between a buyer and seller.
As more and more people join the growing trend of transacting online, scams have been on the rise and there is an increased need to ensure that every party is protected in the course of these transactions.
This is where Escrowlock comes in. On its web app, the seller or buyer fills a form to declare the transaction open. Next, the buyer pays to Escrowlock and waits to receive the goods or services in the agreed condition. Once the buyer confirms receipt, Escrowlock releases the money to the seller.
The startup charges a small percentage for its holding services. Elochukwu confirmed to TechNext in a virtual chat that transaction charges are capped at 3.25% of the amount being moved from the buyer to the seller. “When the transactions are large, the fee drops to as low as 1.25%,” he said.
Using the fee calculator, transactions from N2,000,000 and below attract the regular 3.25% while the fee drops gradually for transactions that exceed N2 million.
While the new funding from Facebook is not enough to pin an expansion of the business on, Elochukwu says Escrowlock will be making use of it to cement its operations in different states of the country. The company will equally add more people to its team of online affiliates and expand its marketplace. It will also expand its Oso Afia program which enables people to promote Escrowlock’s products and earn commission on the sales that they make.
He said, “the funds have been really helpful but not necessarily in the area of helping us expand into new markets. Instead, we will consolidate on our existing market first and that might take the next year or two.”
Ultimately, the goal for this startup is to create an online marketplace where sellers can sell their products and buyers can buy without fear of being scammed.
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