Irish FinTech start-up Umba, which provides ‘micro-finance’ loans in Kenya and Uganda, has raised a seed funding round with Frontline Ventures and ACT Venture Capital.
Founded by former professional rugby play Barry O’Mahony and co-founder Tiernan Kennedy, Umba has secured the undisclosed funding to help them meet the needs of the rapidly-growing African mobile payments and debt market by covering salaries and the running costs of the platform.
After retiring from professional rugby after playing with Munster for four years, O’Mahony founded the start-up with Kennedy, an ex-Saatchi & Saatchi computer engineer.
Already, their smartphone banking app which uses artificial intelligence to refine its lending algorithms, has over 155k customers and has issued over 70k loans.
As well as serving the needs of users who lack access to basic banking facilities, the start-up has committed to helping the next 2 billion people progress into the formal financial world.
Speaking to The Irish Times, Kennedy said: “Traditional banking doesn’t work in developing markets for a number of reasons.
“Unfortunately, no bank account and no banking relationship means no credit rating, which leaves people in a pretty poor position when it comes to leveraging credit options.
“In Kenya, poor transport options, low average incomes and no bank in close proximity are all contributory factors to less than 40 per cent of the population having bank accounts.”