If you want to understand why venture capital is finally flowing into Morocco’s fintech ecosystem, you need to understand the “hanout”.
It’s the small corner store that exists on nearly every street in Morocco. The place where you buy bread in the morning, cigarettes in the afternoon, and mobile phone credit whenever your balance runs low. It’s run by someone who knows your name, extends you credit when cash is tight, and keeps a mental ledger of who owes what to whom. It’s informal, it’s analog, and it’s the financial infrastructure that actually works for millions of Moroccans who don’t have bank accounts, don’t want bank accounts, and wouldn’t use them even if someone opened one for them.
For decades, banks and fintechs tried to bypass the hanout. They built apps. They opened branches. They evangelized digital wallets. And they failed, repeatedly, because they were asking people to trust technology they didn’t understand instead of trusting the shopkeeper they’ve known for twenty years.
WafR, a Casablanca-based fintech founded in 2021, took the opposite approach. Instead of trying to replace the hanout, it digitized it. And as of this week, that strategy just got validated with a $4 million oversubscribed seed round co-led by LoftyInc Capital, Attijariwafa Ventures, and Al Mada Ventures, with participation from returning investors UM6P Ventures and First Circle Capital.
The round is one of the largest seed raises in Moroccan fintech history. More importantly, it’s a bet that the future of financial inclusion in North Africa won’t look like Kenya’s M-Pesa or Nigeria’s Moniepoint — it’ll look like Morocco’s corner stores, digitally enabled, embedded in the fabric of daily life, and trusted by the people who matter most.
What WafR Actually Does — And Why It Took Four Years to Get Here
WafR’s pitch is deceptively simple. It provides small neighborhood stores with proprietary software and payment infrastructure that allows them to offer digital financial services: mobile top-ups, bill payments, cash-in and cash-out transactions, and eventually peer-to-peer transfers and nationwide remittances. The shopkeeper becomes the interface. The customer never needs to download an app, create a password, or understand blockchain. They just walk into the store, hand over cash, and walk out with digital value.
Today, WafR operates a network of nearly 20,000 active merchants across Morocco. Those merchants collectively processed enough transactions to generate 29% month-on-month growth in transaction volume, according to the company. That’s not vanity metrics. That’s evidence of product-market fit in a country where cash still dominates, bank account penetration is limited, and most financial services remain concentrated in urban centers.
Ismail Bargach, CEO and co-founder of WafR, described the funding as a pivotal milestone. “The entry of LoftyInc Capital, Attijariwafa Ventures, and Almada Ventures is a pivotal milestone. Their support brings not just capital but deep fintech experience and strong regional networks that will be instrumental as we scale our impact.”
His co-founder Reda Sellak echoed the point: “This seed round marks a pivotal milestone for WafR. Bringing on strategic partners like LoftyInc, Attijariwafa Ventures, and Al Mada Ventures gives us not just capital but deep regional expertise and networks to scale our impact.”
That emphasis on “networks” and “expertise” is not window dressing. Morocco’s fintech regulatory environment is tighter than Kenya’s, more formal than Nigeria’s, and dominated by large, state-aligned financial institutions that view startups with suspicion. Getting those institutions on your cap table isn’t just about capital — it’s about permission.
The Investor Mix: Local Power Meets Pan-African Ambition
The composition of WafR’s investor syndicate tells you everything you need to know about how to win in Morocco.
Attijariwafa Ventures, the venture arm of Morocco’s largest bank, brings institutional credibility and regulatory access. Al Mada Ventures (also known as Almada Ventures), tied to one of Morocco’s most influential royal holding companies, brings political capital and connections to the country’s economic elite. Both are domestic investors with deep ties to the government, regulators, and the business establishment that still controls most of Morocco’s formal economy.
LoftyInc Capital, by contrast, is a pan-African venture firm with a track record of backing some of the continent’s most successful fintechs: Flutterwave (Nigeria’s $3 billion unicorn), Moove (mobility fintech), and Wave (Senegal’s mobile money disruptor). LoftyInc’s involvement signals that WafR isn’t just a Moroccan play — it’s a model that could scale across Francophone Africa.
Mariam Kamel, Partner at LoftyInc Capital, framed the investment in those terms. “We are proud to co-lead this round and champion WafR’s bold mission. This investment exemplifies our commitment to backing strong founders in high-potential markets who are solving foundational challenges. WafR’s model is unlocking access to essential financial services for thousands of underserved Moroccans — and that’s precisely the kind of impact we seek to scale across Africa.”
That last line — “scale across Africa” — is the tell. LoftyInc didn’t invest $4 million to help WafR become Morocco’s best corner-store payments platform. It invested because it thinks the same model could work in Algeria, Tunisia, Senegal, Côte d’Ivoire, and every other market where informal retail dominates and formal banking doesn’t reach the last mile.
The Morocco Opportunity: $16.5 Billion in Financial Services, Stuck in Cash
To understand why investors are excited, you need to understand Morocco’s structural contradictions.
On paper, Morocco is one of Africa’s most sophisticated financial markets. It has a relatively advanced banking system, a functional stock exchange, and a central bank with regulatory credibility. But beneath that formal layer, the economy runs on cash. Morocco remains heavily reliant on physical currency, with the majority of transactions conducted in cash, bank account penetration limited to urban and middle-class populations, and card usage accounting for a small share of overall payments.
The numbers are stark. Morocco’s financial services market is valued at $16.5 billion, but large portions of the population remain either unbanked or underserved. An estimated 30% of Morocco’s GDP comes from the informal economy, where cash dominates and trust in formal institutions is low. In the retail sector specifically, only 20% of food sales currently take place in formal outlets. The rest happens in hanouts, street vendors, and small independent stores that operate entirely outside the banking system.
That’s not a bug. It’s a feature. For millions of Moroccans, the informal economy isn’t a temporary state on the path to formalization — it’s the permanent economic reality. And any fintech that wants to serve those people needs to meet them where they are, not where a World Bank report says they should be.
WafR’s strategy is to embed digital financial services directly into the stores people already trust. The hanout becomes the ATM. The shopkeeper becomes the agent. And the customer never needs to think about banking infrastructure because it’s invisible, mediated by someone they’ve known for years.
Selma Ribica, co-founder and managing partner at First Circle Capital (which participated in both WafR’s 2022 seed and this current round), put it bluntly: “At First Circle we invest in founders driving digitisation and financial inclusion for the African context, and WafR in Morocco is leapfrogging a solution for the retail sector. Morocco is the sixth largest economy in Africa, with the informal economy accounting for 30% of total GDP.”
She continued: “The retail sector in which WafR is operating is dominated by semi-formal players and cash payments. It is estimated that only 20% of food sales currently take place in formal retail outlets. The Moroccan retail sector is estimated to account for $13 billion per annum, so focusing on the informal segment of this exposes a business to a market value of ~$10 billion.”
That’s the addressable market. Ten billion dollars in annual retail transactions happening outside the formal banking system. And WafR, with 20,000 active merchants, has barely scratched the surface.
What Happens Next: 100,000 Retailers and Product Expansion
WafR isn’t sitting still. The company says the new capital will fund two aggressive expansion priorities.
First, network expansion. WafR plans to grow from 20,000 active merchants to 100,000 retailers — a fivefold increase that would give the company true nationwide coverage. That’s the kind of scale that starts to look less like a fintech startup and more like critical financial infrastructure.
Second, product diversification. WafR is moving beyond mobile top-ups and bill payments into peer-to-peer transfers, nationwide remittances, micro-insurance, and credit scoring for small merchants. That last one is particularly important. If WafR can build credit profiles on 100,000 small retailers based on their transaction history, payment behavior, and inventory turnover, it unlocks access to working capital loans that those merchants currently can’t get from banks. That’s not just financial inclusion — it’s economic development.
The company is also reportedly exploring expansion beyond Morocco into other Francophone African markets, though no specific countries or timelines have been announced. The logic is straightforward: if the model works in Morocco, where regulation is relatively tight and incumbents are strong, it should work even better in markets like Senegal or Côte d’Ivoire, where digital payments infrastructure is less developed and regulatory barriers are lower.
The LoftyInc Alpha Fund: Bridging the “Graduation Gap”
This deal is notable not just for WafR but for what it signals about African venture capital’s evolving structure. The WafR investment is one of the first deployments from LoftyInc Capital’s newly launched Alpha Fund, which targets late-seed and Series A-stage startups that have demonstrated traction but face limited access to growth capital.
LoftyInc describes this as Africa’s “graduation gap” — the point at which startups have proven product-market fit at seed stage but can’t access the $5 million to $15 million growth rounds they need to scale because African VCs are too small and international investors are too cautious. Companies get stuck. Founders burn out. And promising businesses die not because the model doesn’t work but because they can’t raise the capital needed to execute.
The Alpha Fund is designed to fill that gap, writing larger checks into companies that have already de-risked themselves through traction. WafR — with 20,000 active merchants, 29% month-on-month growth, and a clear path to 100,000 retailers — fits that profile perfectly.
LoftyInc’s track record makes the thesis credible. The firm has backed four unicorns over 13 years of investing in Africa, with a portfolio that includes Flutterwave (acquired significant stake by investors valuing it at $3 billion), Moove (mobility fintech), Wave (Senegal’s mobile money leader), and other high-growth fintechs. The firm is now extending its reach deeper into North and Francophone Africa, identifying new champions in markets ripe for digital disruption.
Morocco — with $58 million raised by startups in 2025, ranking seventh on the continent for capital deployed — is emerging as one of those markets. And WafR, as the country’s most scaled fintech infrastructure play, is the test case for whether North African fintech can replicate the success stories of West and East Africa.
Why the Hanout Model Works — And Why It Took So Long
The embedded finance model WafR is deploying isn’t new. M-Pesa in Kenya pioneered agent banking through corner stores and kiosks two decades ago. Wave in Senegal, Moniepoint in Nigeria, and MTN Mobile Money across multiple markets have all used retail agents as distribution nodes for digital financial services.
So why did it take until 2021 for someone to crack Morocco?
Part of the answer is regulatory. Morocco’s central bank, Bank Al-Maghrib, has been slower to issue payment licenses and create sandbox environments for fintech experimentation compared to Kenya or Nigeria. The country’s largest banks — Attijariwafa, BMCE, and others — wield significant political influence and have historically viewed fintechs as competitors rather than partners. Getting regulatory approval to operate at scale required patience, political capital, and the right investor backing.
Part of the answer is cultural. Moroccans are deeply skeptical of digital financial services that feel disconnected from physical trust relationships. A mobile wallet app from a faceless company doesn’t inspire confidence. But a digital payment facilitated by the shopkeeper you’ve known for a decade does. WafR succeeded where others failed because it didn’t try to disrupt trust — it digitized it.
And part of the answer is infrastructure. Morocco’s digital payments rails, telecom networks, and national ID systems weren’t mature enough five years ago to support the kind of real-time, high-volume, low-value transactions that agent banking requires. They are now. And WafR timed its entry perfectly.
Ribica from First Circle Capital summed it up: “Having witnessed the superior execution of this complex model in the market, triple-digit month-over-month growth in revenues, and the razor-sharp focus of the founding team, we decided to double down our investment into WafR. We look forward to their scaling in Morocco and the expansion into the rest of Francophone Africa.”
The Bigger Picture: Morocco’s Fintech Moment
WafR’s raise is part of a broader acceleration in Moroccan fintech.
In November 2025, Cash Plus, a fintech and payments company, became Morocco’s first fintech IPO on the Casablanca Stock Exchange, signaling investor appetite for scaled digital financial services. Earlier in 2025, Chari, a B2B e-commerce platform that also digitizes small retailers, raised a Series B and continued expanding across North Africa. And in 2024, Morocco’s government launched a national digital payments strategy aimed at reducing cash usage and increasing financial inclusion through mobile money and agent banking.
The ecosystem is maturing. Capital is flowing. Exits are happening. And international investors who previously focused on Nigeria, Kenya, and South Africa are starting to look north.
The question is whether Morocco can sustain the momentum. Regulatory clarity remains fragmented. Local investor networks are still small. And the startup talent pool, while growing, doesn’t yet have the depth of Lagos or Nairobi.
But WafR’s raise — oversubscribed, co-led by a pan-African VC and two of Morocco’s most powerful institutional investors — suggests that the pieces are coming together. If WafR can hit its target of 100,000 retailers, launch remittances and micro-insurance, and maintain 29% month-on-month growth, it will become the largest fintech infrastructure platform in North Africa.
And if it can replicate the model in Senegal, Côte d’Ivoire, and Tunisia, it will prove that agent banking — mediated through trusted local retailers — isn’t just a Kenyan story or a Nigerian story. It’s an Africa story. And Morocco just became the next chapter.
WafR was founded in 2021 and is headquartered in Casablanca, Morocco. The company currently operates nearly 20,000 active merchant locations. LoftyInc Capital is headquartered in Lagos, Nigeria.
