Nigeria-based fintech startup Thepeer has announced its closure, returning its remaining capital to investors after facing insurmountable challenges in scaling its operations. The company’s co-founders, Kosisochukwu Chike Ononye and Michael “Trojan” Okoh, expressed disappointment at the closure, attributing it to compliance issues and slow adoption of digital wallets as payment options.

Thepeer, which secured a $2.1 million seed round in June 2022, aimed to revolutionize financial transactions across Africa by providing APIs for embedding various financial products into applications and websites. Despite initial optimism and substantial investment, the startup struggled to overcome hurdles in regulatory compliance and market acceptance.

The decision to cease operations comes as a blow to investors and the fintech community, marking the second instance in 2024 of a Nigerian startup returning capital after failing to sustain its business model. Cova, a wealthtech startup, faced a similar fate earlier in the year, underscoring the challenges inherent in building fintech ventures on the continent.

Launched in April 2021, Thepeer initially garnered attention for its innovative approach to facilitating money movement for fintechs and businesses. Backed by notable investors including Ezra Olubi, co-founder of Paystack, and Prosper Otemuyiwa, CTO of Edenlife, the startup seemed poised for success.

However, despite significant early-stage funding and ambitious expansion plans, Thepeer struggled to achieve widespread adoption of its services. The company’s monthly transaction volume reached impressive figures, with a month-on-month growth rate of 161%, but it ultimately failed to align its product with market demands.

In a statement addressing the closure, the co-founders acknowledged the need to reassess their strategy and focus on core priorities. Thepeer’s platform will enter maintenance mode indefinitely.