MoCaFi, a financial empowerment fintech focused on the unbanked and underbanked communities, filed for Chapter 7 bankruptcy Friday and has begun the liquidation process.
Short for Mobility Capital Finance, MoCaFi struck partnerships with banks including BNY and Citi since its founding 11 years ago by Wole Coaxum, a former JPMorgan Chase managing director.
“Over the past several years, I’ve had the privilege of leading MoCaFi on a mission to expand financial access and opportunity for communities that have historically been underserved,” Coaxum wrote in a LinkedIn post Friday.
“This outcome is not the one we worked toward,” he wrote. “The company faced a dramatic shift in its operating environment following the loss of a major program that had been central to our revenue model. Despite exploring a range of options, we ultimately determined there was no credible path for the company to continue as a going concern.”
Coaxum did not respond to an inquiry by press time or name the program that was lost.
But last year, readiness issues at the company caused BNY, with which MoCaFi was partnering on the Treasury Department’s Direct Express program, to lose out on the contract. Direct Express delivers government benefits to roughly 3.4 million largely unbanked Americans, according to Bloomberg.
Last June, BNY notified the Treasury Department that it needed more time, Bloomberg reported, but the department rejected the delay and opted to work with Fifth Third instead.
“Over the past several months, our focus has been on winding down responsibly — ensuring that customers were safely transitioned and that our employees were treated with care and respect during a very difficult period,” Coaxum wrote on LinkedIn.
“While this chapter is coming to a close, I remain incredibly proud of what the MoCaFi team built and the impact we had,” he wrote. “We demonstrated that mission-driven financial technology can reach people and communities that traditional systems often overlook.”
Neither BNY nor Citi responded to inquiries on their partnerships with MoCaFi.
