The startups driving a $1.4B bull market in address verification
Two years ago, we collaborated with our friends at Tech Safari on what many readers consider one of their favorite Alts issues: Investing in Rwanda. 🇷🇼
Today, we’re teaming up with Tech Safari once again, for another very special issue on Africa.
In most parts of the world, a home address is an afterthought — a basic necessity no one questions.
But in Africa, having an address isn’t guaranteed. It’s a privilege.
In fact, an astounding 440 million Africans — nearly 30% of the population — lack a formal address. And without it, they’re locked out of many things. They can’t get loans, accept deliveries, or register a business.
It’s not just impacting people and businesses — governments are hit too. After all, a government cannot effectively tax people they can’t track.
As always, this challenge is also an opportunity. And innovative startups and investors across Africa are stepping up to solve it.
Today, we dive into the under-discussed problem of addressing Africa.
Let’s go 👇
This issue was co-written by Sherif Alimi and Caleb Maru from Tech Safari. If you’re interested in what’s happening on the world’s largest continent, Caleb and his community are all over it. Before you do anything else, I encourage you to subscribe to Tech Safari 🧭
Table of Contents
Addressing the problem: Industries are losing billions
For most people, being off the grid can be life-threatening. If emergency services can’t find you, they can’t help you.
For businesses, the stakes are just as high.
Africa’s lack of formal addresses is stifling entire industries, driving up costs, and creating billion-dollar inefficiencies.
- E-commerce: Delivery costs are 30-50% higher than in other regions of the world.
- Financial services: In 2024 alone, Nigerian fintechs spent $1 million on address verification just to comply with regulations.
- Agriculture: Farmers can’t prove land ownership, making it risky to invest in
Residents cope with alternative address systems
You may be wondering: How are African people dealing with this problem
It’s as awkward as you’d expect. Many rely on landmarks (“Next to the blue kiosk”) or word-of-mouth directions, which aren’t exactly a solution for home businesses.
Others use informal addressing systems, like associating their phone number with a location. But these are unreliable and don’t meet regulatory requirements.
Governments have tried to step in. Digital solutions like GhanaPostGPS 🇬🇭 were launched to bridge the gap. But adoption has been low. Without a universal, trusted system, the problem persists — limiting financial inclusion, slowing e-commerce, and keeping millions in the shadows of the formal economy.
These informal workarounds are helpful, but they won’t cut it going forward. Africa’s population is set for explosive growth in the coming decades. Without a scalable addressing solution, these problems will only multiply.
African startups are stepping up
New innovative startups are sprouting up to solve this.
One very notable example is OkHi, a smart addressing system that launched in Nigeria in 2021. 🇳🇬
OkHi focuses on identifying individuals rather than locations by assigning a GPS point, photo, and text instructions linked to a person’s name and phone number.
This approach enables businesses to collect and verify customer addresses seamlessly through their smartphones, eliminating the need for utility bills or in-person interactions.
Globally, alternative addressing systems have been developed to tackle similar challenges:
- 🇬🇧 UK-based What3Words divides the entire world into 3×3 meter squares, assigning each a unique combination of three words. This allows for precise location identification, even in areas without formal addresses.
- 🇳🇱 Netherlands-based Mapcode is designed as a free, international standard, Mapcode provides a short code for any location on Earth, facilitating easy communication of precise locations.
- 🇺🇸 US-based Loqate offers advanced software for capturing, verifying, and enriching address data globally, Loqate helps businesses ensure accurate and reliable location information.
These innovative systems are crucial in bridging the address gap.
But there’s an even bigger opportunity here, and it’s in fintech.
Full financial inclusion: The ultimate goal
African fintech is booming. More people than ever are opening digital wallets, transacting online, and accessing financial services.]
But fintechs have an enormous problem: KYC regulations (Know Your Customer).
Financial services companies are required to verify who their customers are and where they live.
That’s pretty easy in most of the world. But in Africa, where millions lack formal addresses, it’s a nightmare.
The cost of no addresses
Without a proper addressing system, fintechs are forced to find very expensive workarounds:
- 🇰🇪 Kenyan money transfer service M-Pesa has built a massive agent network just to manually verify identities.
- 🇳🇬 Flutterwave is constantly tweaking KYC procedures after running into compliance issues.
- 🇳🇬 In April 2024, the Nigerian Central Bank froze new customer signups for some fintechs until they could physically verify addresses.
- As a result, companies like Moniepoint, OPay and PalmPay (all based in Nigeria 🇳🇬) were forced to spend $1 million just to verify users. That’s a huge amount for African tech startups.
Remember: New African fintech companies are often targeting people at the bottom of the income pyramid — delivering micro-finance (i.e. micro loans), and alternative forms of credit.
And these are precisely the people most likely to lack addresses! So, every time a compliance snag is hit, that means, someone, somewhere is being denied a much-needed loan, or is locked out of their cash.
The bull market in identity verification
The demand for identity verification and better address systems is growing fast.
- 🇳🇬 As discussed above, Nigerian startup OkHi assigns GPS coordinates, a photo, and text instructions to a person’s phone number — identifying people, not places.
- 🇳🇬 Regfyl & YouVerify provide plug-and-play KYC software that helps fintechs verify new users.
- 🇷🇼 MPost helps Rwandans convert their phone numbers into postal addresses.
If these solutions reach scale, the promise of continent-wide financial inclusion may finally come true.
And it’s not just fintechs that stand to benefit — it’s the entire African economy.
Think about it:
- 🇬🇭 Drug companies like Ghana-based mPharma can now verify user identities to provide better healthcare.
- 🇰🇪 Agtech startups like Kenya-based Twiga Foods can reduce costs and make food deliveries less expensive.
- 🇳🇬 Lending companies like Nigeria’s Kuda Bank can cheaply sign up and verify new bank customers (they’re a client of OkHi).
The companies aren’t just fixing KYC — they’re effectively reshaping financial access, logistics, and the entire African economy
The global perspective: Address challenges beyond Africa
Africa isn’t alone. Around the world, the lack of clear, reliable addressing systems creates all sorts of friction.
While the stakes may differ, the consequences are the same: inefficiency, exclusion, and lost opportunity.
Here are a few countries where the problem is particularly acute — and what’s being done to fix it.
🇯🇵 Japan
For such an efficient-minded country, Japan’s addressing system is shockingly unintuitive.
Interestingly, buildings aren’t numbered by location, but by order of construction. Streets often go unnamed. Even locals rely on landmarks and detailed instructions.
Japan hasn’t adopted sweeping reforms, but private sector solutions are emerging. Companies like Daon and Trusona offer biometric identity and location verification services to banks, insurers, and healthcare providers, helping them navigate the system without relying on addresses alone.
🇦🇪 United Arab Emirates
The UAE may be wealthy, but it still lacks a formal post code system. Residents rely on PO Boxes, vague neighborhood names, and Google Pins.
PostGrid offers address verification tools designed for the UAE’s unique system, and Signzy provides digital KYC platforms that help UAE banks and fintechs onboard users without needing a traditional home address.
🇲🇳 Mongolia
Mongolia’s vast rural landscapes and nomadic culture make conventional addresses a nightmare. But in 2016, the government partnered with What3Words to help navigate the nomadic landscape.
Today, rural herders are getting medicine delivered to their door.
🇮🇪 Ireland
Ireland’s postal system was a mess before 2015. Multiple homes in rural areas shared the same address. Mail went missing. Emergency services got lost.
To fix it, the government spent €38 million to launch Eircode, which gave every property a unique code. The company behind Eircode now licenses the system globally.
From Mongolia’s high desert to Tokyo’s backstreets, one truth emerges: no country has truly nailed the address problem.
And the market is only getting hotter. The global address verification market is projected to reach $1.4 billion by 2028.
Closing thoughts: AfCFTA and the future of African trade
Let’s bring it back to Africa — where one of the biggest economic opportunities in the world is quietly unfolding.
In fact, this is such an important development that it’s surprising more people don’t seem to know about it…
It’s called the African Continental Free Trade Area AfCFTA — a trade agreement with the goal of unifying all 54 African nations into a single market.
Basically, this is Africa’s plan to make it easier for all 54 African countries to trade with each other. Fewer barriers, more goods moving between countries, more economic growth.
This is why solving Africa’s address problem isn’t just about inclusion — it’s about unlocking the continental potential of AfCFTA itself.
Standardized, interoperable address systems could become a foundational layer for everything AfCFTA promises:
- Faster customs clearance
- Cross-border e-commerce
- Scalable logistics platforms
- Even infrastructure projects
And the timing couldn’t be more relevant. Around the world, free trade agreements are under immense pressure — from Brexit, to tensions around the USMCA agreement (United States–Mexico–Canada Agreement), to tariffs recklessly flying in all directions.
Africa’s appetite for cross-border cooperation is growing at precisely the same time that the US and the west are moving the other direction! AfCFTA is a rare moment of unity in a fractured global economy.
But free trade depends on movement, and movement depends on infrastructure and logistics.
And at the core of logistics? You guessed it: addresses.
Without a functioning addressing system, goods don’t reach buyers, services don’t scale, and supply chains remain fractured. Even the most ambitious trade deal in history can stall at the last mile if no one knows where to deliver.
This isn’t just fixing the e-commerce logistics layer — it’s essentially building new rails for some of the fastest-growing industries: especially e-commerce, fintech, and healthcare.
Bottom line: Fix the addresses, unlock the continent. 📍
That’s it for today!
A big thanks to Sherif Alimi and Caleb Maru from Tech Safari for collaborating on this issue. I encourage you to subscribe to Tech Safari
Come find me on in the Alts Community.
Disclosures
- This issue was co-written by Stefan von Imhof, Sherif Alimi and Caleb Maru. Editing was done by Stefan von Imhof.
- This issue was sponsored by Arta Finance
- Aside from Arta, none of the companies mentioned in this issue paid to be included.
- Neither Alts nor Altea has any current holdings in any companies mentioned in this issue
