FUNDING | Umba Raises $5 Million to Expand Asset Financing in Kenya After 6x Revenue Growth in 2024

Umba noted that vehicle financing has emerged as a core focus of its operations in Kenya, driven by growing demand for auto loans. The company highlighted the country's expanding vehicle base - now exceeding 5 million registered vehicles, a significant rise from 3.9 million in 2021 - as a key factor fueling this shift.

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Umba, a digital bank based in Nairobi and active in both Kenya and Nigeria, has secured a $5 million debt facility to expand its secured lending portfolio in Kenya.

The funding will primarily support vehicle financing and loans for small and medium enterprises (SMEs).

Founded in Nigeria and relocated to Kenya in 2023, the company has experienced strong momentum, recording 19% month-over-month revenue growth in 2024 and a sixfold revenue increase over the past year. This rapid expansion has been driven by strong uptake in vehicle and SME financing, while the introduction of new products has helped boost customer satisfaction.

Umba Kenya is now on course to turn a profit in 2025.

“With the confidence of key financial backers like Star Strong Capital, Umba is poised to leverage this funding to broaden its market influence,” said Tiernan Kennedy, Co-Founder and CEO of Umba.

“Our Kenyan launch has exceeded expectations, with excellent lending performance. As the only pure-play digital bank in the market, we’re delivering a better way to bank for Kenyans through speed, accessibility, and tailored financial solutions.”

 

Umba noted that vehicle financing has emerged as a core focus of its operations in Kenya, driven by growing demand for auto loans. The company highlighted the country’s expanding vehicle base – now exceeding 5 million registered vehicles, a significant rise from 3.9 million in 2021 – as a key factor fueling this shift.

“The vehicle financing market is valued at around $17 billion,” Kennedy said. “It is now the largest part of our loan book in Kenya.”


Umba is also leaning into asset-backed products over unsecured digital loans which have defined much of the fintech sector.

“While many fintechs focus on high-interest, short-term unsecured loans, we’re building long-term customer relationships through asset-backed products,” Kennedy said.

 

The Kenyan fintech landscape is notoriously challenging, having witnessed the collapse of several players in recent times. Most recently, Lipa Later, a buy-now-pay-later (BNPL) startup, entered administration in March 2025 after failing to secure additional funding and facing mounting debts.


Despite raising $12 million in seed funding in early 2022 and an additional $3.4 million in debt in September 2023, Lipa Later struggled with financial pressures, leading to unpaid salaries, legal disputes with suppliers, and questions surrounding its acquisition of another distressed e-commerce platform, Sky Garden.


Spring Hollis, Founder and CEO of Star Strong Capital, sees Umba’s innovativeness as key to doing well in Kenya and Africa.

“It is an investment in the future of digital banking and financial inclusion in Africa.

We believe Umba’s innovative approach and customer-centric model position them to become a key player in Kenya’s fintech revolution. This debt financing will support their continued growth and ensure they remain at the forefront of delivering accessible, affordable financial solutions to underserved markets,” he said.

 

 

 

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