Online lender Umba, which refers to itself as a digital bank built for Africa, has revealed plans to expand its service offerings in the wider African continent. To this end, the firm has said it has established offices in Kenya as it eyes other markets in the coming days. The startup had at one time run its services locally, but at a period when the online digital lending space was not regulated. More than two years ago, Umba stopped operating in Kenya, and following this current development, it appears to have met the regulations set forth by local legislators, including stringent regulations by the CBK and other financial authorities.
According to a statement made by the company via Disrupt Africa, Umba’s objective is to simplify the communication between consumers and small businesses with banks and mobile money providers, by delivering a cost-effective and transparent service that empowers users to manage their finances.
Umba offers customers a current account with no fees, low-priced transactions, bill payments, and loans. The startup also leverages the data generated by its users to offer credit products, generate revenue, and facilitate repayments through mobile phones.
Following its acquisition of a controlling stake in Daraja Microfinance Bank, Umba can now provide complete banking services, including insured current accounts by the Kenya Deposit Insurance Corporation (KDIC), savings accounts that earn interest, fixed deposit accounts, loan services, and payment options in the country.
Since it now owns the majority stake at Daraja Microfinance Bank, it is officially certified as an online lender, just like other digital loan providers such as Branch, which acquired Century Microfinance Bank.
Umba enjoys support from top fintech investors, including Costanoa Ventures, who spearheaded the startup’s Series A funding round, and other notable investors such as Lachy Groom, Lux Capital, Palm Drive Capital, and individual investors like Tom Blomfield, the founder of Monzo, and executives from NuBank. Chandaria Capital is also a supporter of Umba and played a key role in the company’s launch in Kenya.
Umba has recently strengthened its executive team with the appointment of Peter O’Toole and Dan Watts.
Peter is a seasoned CFO and financial services professional with over three decades of leadership experience. He previously served as the Group CFO of Interswitch and CFO of Renmoney.
Dan Watts, on the other hand, has a decade of experience in developing creative and sustainable lending programs with banks and fintech companies in Africa, in his role as Chief Credit Risk Officer at both Renmoney and Carbon.
“It’s a fantastic opportunity we have been given to bring Umba to the Kenyan market. It’s been an extremely challenging and lengthy process to make this acquisition but the ability to stand on our own two feet and grow the bank into a serious player in the market is absolutely worth it,” said Umba CEO Tiernan Kennedy.