Fintech platform Lidya has closed a seed funding round of USD$1.25-million, being led by Accion Venture Lab, the company announced. Newid Capital were among several other investors also responsible for contributing to the funding round.
The seed stage investment is an Accion initiative which invests capital in innovative fintech startups that either reduce the cost of financial services or improves the quality of financial services for the underserved.
“This round of funding and backing from our world-class group of investors is a strong validation of the potential of fintech in Africa and will position the company to be the go-to source of financing for entrepreneurs looking to grow their business,” said a co-founder of Lidya, Ercin Eksin in a press release.
The fintech platform will use its new injection of funds to accelerate its product development as well as expand its team.
According to the platform, Lidya uses over 100 data points to assist SMEs in connecting them with capital and to build a customised credit score.
Lidya uses new investment to expand its reach as well as its team
Once Lidya has evaluated a customer, the qualified business will receive a loan in 48 hours depending on its risk level.
“Our vision is to digitise and streamline the credit assessment process to make it easy for any SME across Africa to access the funding they needed to grow their business,” said fellow Lidya co-founder, Tunde Kehinde.
According to Lidya, the company has already registered 20 000 businesses for its service. Its portfolio consists of businesses within the agricultural sector, consumer goods and creative industries among others, targeting ₦1.5-billion in loans to SMEs in its first year of operations.
“Small businesses around the world today are unable to get the financing they need to grow and thrive,” said CEO of Accion, Michael Schlein.
“Innovative fintech startups like Lidya are addressing this need with technology and new sources of information to help entrepreneurs obtain the necessary capital to hire employees, expand to new markets, and sustain successful businesses,” Schlein concluded.