TurnStay, a South African fintech startup for cross-border payments in the travel and tourism industry, has raised more than R34 million pre-seed funding round. Lead investors in the funding round are First Circle Capital with other strong supporters including TLCom Capital, Enza Capital, Incisive Ventures and Evergreen earlier this year.
The travel industry, particularly in Africa, faces significant challenges related to cross-border payments. For African travel operators, common obstacles include high card fees, frequent payment failures, and long settlement delays. TurnStay has developed a solution to tackle these inefficiencies head-on, enabling operators to streamline payments and reduce operational costs.
TurnStay utilizes a merchant-of-record model combined with stablecoin settlement technology. This innovative approach allows the platform to minimize transaction fees and expedite payment processing. According to TurnStay, its solution can reduce transaction costs by as much as 70%, leading to increased booking conversion rates and enhanced operational efficiency for local travel businesses.
Founded by experienced fintech entrepreneurs, TurnStay seeks to offer African travel businesses the opportunity to access cutting-edge financial tools typically reserved for international players. By doing so, it aims to provide a more competitive alternative to traditional payment providers and global booking platforms, which often impose high fees and commission rates.
TurnStay’s model offers local businesses greater control over their financial processes. The platform allows operators to settle payments in South African rand while still accepting international payments from customers. Moreover, TurnStay facilitates more direct bookings by bypassing global online travel agents (OTAs), who typically charge significant commissions, allowing local businesses to retain a greater portion of their revenue.
Tourism plays a crucial role in Africa’s economy, supporting more than six million jobs and generating an estimated R1.8 trillion annually. Despite its importance, the sector has been hindered by high payment costs, limiting the potential for growth in local markets. TurnStay’s solutions aim to overcome these barriers by providing a more cost-effective and efficient payment system for African travel businesses.
With its recent funding boost, TurnStay plans to expand its presence into key African markets and further develop its payment infrastructure. By enhancing its platform, the company seeks to cater to the unique needs of the African tourism industry and empower local businesses to thrive in a competitive global landscape.
Since its inception, TurnStay has already demonstrated significant growth and impact. The platform has processed over R250 million in transactions since raising R5.7 million in its pre-seed round last year. Furthermore, the startup has secured partnerships with several key industry players, further solidifying its position as a leader in the fintech space for the travel and tourism industry.
With a rapidly growing travel sector, especially in Africa over the next few years, TurnStay is set to make inroads on how cross-border payments become part of the new Future. These solutions not only allow local operators to develop their small and medium enterprises, but also contribute to the larger development of the African tourism industry.
Given that we plan to soon announce the results of a ground-breaking solution for cross-border payment challenges, TurnStay is clearly in a great spot to lead the wave even in massive sectors like Fintech and Travel across Africa. This seed funding provides the startup — which already has a strong pipeline of new customers — with resources to deepen its products, expand into additional markets and execute on its innovative vision for travel payments across Africa.
