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Tala Gets Sh11Bn More

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Leading mobile lending company Tala on Wednesday announced a Sh11 billion investment to support the company launch a bunch of new products and grow its operations across the world.

The five-year-old startup is being financed by RPS Ventures, with GGV Capital and previous investors IVP, Revolution Growth, Lowercase Capital, Data Collective VC, ThomVest Ventures and PayPal Ventures also participating in a new financing round.

Tala general manger in East Africa Ivan Mbowa said the new round of funding will enable online micro-lender to reach more customers.

Tala approves loans within minutes and disburses the money to customers via mobile payment platforms. The startup has lent over $1 billion to more than 4 million customers to date up from $300 million to 1.3 million customers the previous year claims Shivani Siroya the founder of the app.

This means the company can offer more loans than ever to Kenyans while charging 5-15% interest and fees in a startup meant to deliver financial access, choice and control to undeserved people. The company also forwards negative credit history and rankings to the local credit bureaus when the loan is defaulted.

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The company boasts over 2.5 million customers in Kenya. “Kenya is at the heart of Tala’s operations around the world. Kenya was our first home, and today it remains our largest office and customer base. We are thankful every day for the loyalty and trust of our Kenyan customers,” Mr Mbowa said.

Just recently a study conducted by The Financial Sector Deepening (FSD) survey, which has the backing of the Central Bank of Kenya (CBK) shows that about 20% of Kenyans are loan defaulters. One in every five Kenyans has a loan which they have not paid, the study concluded. The most affected being unemployed and low income employed youths, farmers and the elderly.

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With the added Funds mobile-based digital lender Tala which has gained wide popularity in recent years and advanced billions of shillings to the private borrowers, the household debt burden will only skyrocket.

The study also revealed about 6.5 million Kenyans are digital borrowers with 31 percent taking the cash to try their luck in sports betting and gambling.

 


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