Nigerian fintech and lending startup Lidya has closed an $8.3 million pre-Series B funding round to expand its lending operations for SMEs and strengthen its presence in Africa and Europe.
The investment round was led by Alitheia Capital with participation from Bamboo Capital Partners, Accion Venture Lab, and Flourish Ventures.
Back in 2017 and 2018, the startup raised a $1.3 million seed round and $6.9 million Series A respectively. With the new investment, the total funding amounts to $16.5 million.
Co-founded by Tunde Kehinde and Ercin Eksin in 2016, Lidya basically started out of a need to provide lending services to small and medium-sized enterprises. On the platform, businesses can create accounts and apply for loans ranging from $500 to $50,000, with decisions made within 24 hours.
The company claims to use 100 data points to assess each prospective applicant and build a credit score for them to evaluate credit risk. In 2018, Lidya had given around 1,500 business loans and was set to venture into new African markets. Surprisingly, Europe was the destination of choice.
Having launched its new operations in two European countries- Poland and the Czech Republic- in October 2019, Lidya commenced operations during the onslaught of the pandemic in early 2020.
Within that time, Lidya claims to have disbursed over $3 million to SMEs in the two countries. To date, the company has disbursed over 25,000 loans and claims to have more than a 90% customer repeat rate.
According to Kehinde, by this time next year, the startup plans to replicate its success 5x more than what it has achieved. In addition to expanding its teams in Lagos, Prague, and Warsaw, a portion of the new funds will support Lidya’s lines of credit.
“We’re really excited about the fact that we started in Nigeria and now our product is live in two European countries. Typically people come into Nigeria from other parts of the world but we’ve gone from Nigeria to other parts.
We’re proud of the traction we’ve gotten in our push to build the biggest finance house for SMEs in our markets,” he said.
Commenting on the investment, Alitheia Capital co-founder and managing director said, “Lidya is tackling the fundamental challenge of providing access to credit for dynamic small and growing businesses that otherwise have limited options for financing working capital to scale their businesses in Africa and Europe.
Alitheia Capital and Goodwell are pleased to be backing a team whose mission aligns with our objective of driving growth and social impact by enabling access and inclusion to finance and financial services.”
Image Credit: Tunde Kehinde, Founder and CEO, Lidya
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