We are pleased to announce that our portfolio company, Numida, a Uganda-based digital lender that provides working capital loans to small and micro businesses has closed a $12.3m pre-Series A round. The round was led by Serena Ventures with participation from Breega, 4Di Capital, Launch Africa, Soma Capital, and Y Combinator. We invested in Numida in 2019.

Small businesses in Africa contribute up to a third of the continent’s GDP. In addition, they provide an estimated 80% of jobs in Africa and are therefore a major driver for economic growth. Despite their significance in employment and poverty eradication, small businesses continually face credit constraints because of their size and informality. Stringent collateral requirements and lengthy application processes by traditional financial institutions also impede credit access for small and micro businesses.

Launched in 2016, Numida alleviates these credit constraints by offering a mobile application, through which small business owners can apply for unsecured short-term business loans ranging from $100 to $5,000. These loans have a tenor of one to three months. Numida has a quicker and more efficient process than traditional financial institutions by digitizing the loan application, credit scoring, disbursement, and repayment.

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