Africa-focused digital bank, Umba, has raised a $5 million debt facility to accelerate its secured lending operations in Kenya, a strategic pivot that signals the company’s maturing financial model and long-term vision for inclusive digital banking in Africa.
The funding, which comes exclusively from US-based Star Strong Capital, marks a shift in fintech funding narratives—from runway-extending capital to revenue-generating investment. Umba will use the funds to expand its vehicle financing and small and medium enterprise (SME) loan offerings in Kenya, a country where it operates through Daraja Microfinance Bank, in which it acquired a majority stake in 2022.
“This is revenue-generating capital, rather than runway-extending capital,” said Tiernan Kennedy, Umba’s CEO and co-founder. “We’re focused on scaling products that are already performing in the market.”
The $5 million facility brings Umba’s total funding to $20 million. In 2022, the company had raised $15 million in Series A funding—led by Nubank executives—to support expansion into Kenya, Ghana, and Egypt. While only Kenya has gone live so far, Umba’s operations in the country are showing strong signs of growth and approaching profitability, with revenue growing sixfold in 2024 and 19% month-on-month.
A key driver of this growth is vehicle financing, which Kennedy describes as “now the largest part of our loan book in Kenya.” The auto loan market in Kenya is estimated at $17 billion, and with over 5 million registered vehicles—up from 3.9 million in 2021—demand is robust.
Umba’s approach to lending diverges from traditional banks. It offers digital onboarding, real-time verification, and faster disbursement, removing the friction often found in legacy financial systems. This streamlined model appeals especially to SMEs and vehicle owners who require faster, more accessible financing.
The company is also part of a broader shift in Africa’s fintech landscape, where digital lenders are moving away from short-term, high-interest unsecured loans and toward asset-backed lending that promotes long-term financial inclusion and customer retention. Competitors in this space include firms like Autochek, which also offers vehicle financing.
Founded in 2018 by Kennedy and former rugby player Barry O’Mahony, Umba began operations in Nigeria in 2021 and entered Kenya in 2023. O’Mahony stepped away from the business in 2023, and Umba has since completed senior leadership hiring in both countries. While it has yet to name its incoming Kenya CEO, the company confirmed it has no immediate plans to pursue a commercial banking licence, unlike some of its peers such as Moniepoint.
Umba sees the microfinance framework as fully capable of supporting its secured lending ambitions. Through Daraja, one of Kenya’s 14 licensed microfinance banks, the company provides a full suite of banking services, including current accounts, savings products, fixed deposits, and loans.
“Our partnership with Umba is more than just a financial transaction,” said Spring Hollis, CEO of Star Strong Capital. “It is an investment in the future of digital banking and financial inclusion in Africa.”
With profitability in sight and a growing foothold in Kenya’s fintech sector, Umba is poised to become a key player in reshaping how credit is accessed in Africa.
