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HomeFunding RoundsKenyan fintech Zanifu raises $11.2 million to scale inventory financing offering.

Kenyan fintech Zanifu raises $11.2 million to scale inventory financing offering.


Kenyan fintech Zanifu raised $11.2 million to scale its inventory financing offering. The fintech provides inventory financing to small and medium-sized businesses and has raised $11.2 million in debt-equity funding in a pre-series funding round led by Beyond Capital Ventures and Variant Investments. Participators include Founders Factory Africa, AAIC Investment, Google Black Founders Fund, and existing investor Launch Africa. The total debt-equity funding raised amounts to $12.7 million.

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Zanifu intends to target businesses that cannot access credits from formal financial institutions because of their lack of structure, accounting books, and assets that can be used as collateral, Biko said. Yet, these businesses also require credit for sustainability, operations, and expansion. Zanifu gives these businesses credit based on the data it collects from them and the people who supply them. The fintech directly pays their suppliers by de-risking the line of credit.

Biko said, “In our first product, we only lent to retailers to help them expand their business, but we found out that distributors have a similar problem.”

The Fintech says it has so far given out credit to 13,000 micro-businesses and has served 500 distributors following their expansion of customer base. While stock financing differs based on the business’s size, distributors can access up to $10,000, and retailers can get goods worth from $200-$500.

Biko went on to say that with time, the algorithm has gotten better. So far 5% to 6% interest charged monthly has brought a repayment of up to 99.2%.

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The fintech customers use an Android application to make orders and know their credit limit. To facilitate swift repayments, the fintech has integrated multiple channels.

Biko said that Zanifu is building a platform for distributors to update their stock-keeping units. He added, “We found out that most of these retailers, especially in this market, have multiple distributors. And we increased their limits and allowed them to pay any of their distributors”.

The startup intends to scale operations in Kenya, and expand to Ghana and then Uganda where small businesses find it hard to get credits. Studies have shown that small enterprises strengthen the economy, make up nearly 90% of businesses in Africa, and add to job creation.

“We have decided to go deep in Kenya. We are focusing on serving more micro-SMEs, getting more distributors into our fold, and ensuring the capital we are dispersing is generating returns for these businesses and helping them grow. So that’s really how we’re looking at it for now. We will go to other markets once we get to profitability,” said Biko, who co-founded Zanifu with Sebastian Mithika.

Zanifu builds tools to help businesses manage their inventory and bookkeeping. The fintech also offers insurance and is licensed by the Central Bank of Kenya.



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