Ugandan digital lender Numida has raised $12.3m

Ugandan fintech start-up Numida has been in business since 2017. The company has found its footing by offering its clients loans ranging from $100 to $5,000 depending on their business portfolio, at an interest rate of 10 % to 16%.

The company has now announced that it has secured $12.3 million in pre-Series A equity and debt financing to help it expand its team and enter new markets.

The startup uses proprietary credit models and technology-enabled underwriting processes to enable customers to obtain unsecured loans. Numida says that unlike most digital lenders today, they do not use customer data such as contacts and social media accounts as a condition for loan disbursement.

Numida is the brainchild of Mina Shahid, Catherine Denis and Ben Best who brought it to life in 2017.

“Our claim to fame is that we’ve figured out how to mark and disburse unsecured working capital to cash-based businesses that don’t have a digital transaction history. We’re not reliant on any point-of-sale data digital or e-commerce marketplace and we also don’t scrape people’s phones.This has allowed us to expand our customer segment significantly and serve the family shops that make up the majority of businesses in Africa,” says Shahid.

The funding round was led by Serena Ventures, injecting $7.3 million in equity funding. Other participants include Breega, 4Di Capital, Launch Africa Ventures, Soma Capital and Y Combinator, as well as existing investor MFS Africa. The remaining $5 million will be financed by debt from Lendable Asset Management.

“We are impressed with the strength and commitment of the Numida team and their methodical approach to solving a very complex problem – how to provide a $500 loan to a business that has no collateral, operates in cash and is semi-formal,” said Alison Rapaport, general partner at Serena Ventures. “We are thrilled to join their mission to unlock the potential of these businesses across the continent,” she added.

The Y-Combinator-backed startup operates in an environment long neglected by traditional banks.

The company says it has so far provided more than $20 million in unsecured working capital to 27,000 micro and small businesses.

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