Digital bank, Umba, has raised a US$5 million debt facility to scale its secured lending operations in Kenya, underscoring a growing interest among African neobanks toward sustainable, long-term credit products.
- •The Nairobi-headquartered fintech, which also operates in Nigeria, said the funds will support its fast-growing vehicle financing and small and medium enterprise (SME) lending services.
- •The facility was structured as debt by the U.S.-based asset manager Star Strong Capital and the raise brings Umba’s total funding to US$20 million.
- •Founded in 2018, Umba entered the Kenyan market in January 2023 following its 2022 acquisition of a 66.6% stake in Daraja Microfinance, a deal that granted it a microfinance banking license from the Central Bank of Kenya.
“This milestone enables us to deepen our footprint in one of Africa’s most dynamic Fintech ecosystems—expanding access to vehicle financing, SME credit, and high-yield savings products,” Tiernan Kennedy, Umba CEO, announced.
Despite holding less than 1% of the microfinance market share, Daraja’s infrastructure has enabled Umba to tap into underserved SME pockets. The company also claims to have grown revenue sixfold in 2024 and anticipates turning a profit in Kenya this year.
Umba raised $15 million in Series A funding in 2022, led by executives from Brazil’s Nubank, to fund its expansion plans across Kenya, Egypt, and Ghana.
While many fintechs in the region continue to focus on short-term, high-interest digital loans, Umba is betting on secured, asset-backed lending. Vehicle financing, in particular, has emerged as a critical growth area amid rising demand.
The company is also hiring a Kenya CEO after its co-founder Barry O’Mahony exited the company in 2023.
