Lipa Later, a prominent buy now, pay later (BNPL) fintech company operating in Kenya, Uganda, Rwanda, and Nigeria, has been placed under administration as the company struggles with financial crisis and failed attempts to secure additional funding.
The administration effective March 24, 2025, will see a new administrator take over the business assets and the management of affairs of the company without personal liability.
In an insolvency notice seen by Tekedia, titled “The Insolvency Act 2015 Notice of Appointment of Administrator Over Odyssey Capital Limited”, part of the documents reads,
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“Pursuant to Section 563 (2) (b) of the Insolvency Act 2015 of Kenya, Notice is hereby given that effective 24th March 2025, Joy Vipinchandra Bhatt of Moore JVB Consulting LLP IP No. OR/P/024. has been appointed as an Administrator (The Administrator) of Lipa Later Limited (‘LLL’ or ‘The Company ].
The Administrator takes control over the business, assets, and the management of the affairs of the company without personal liability. By virtue of the administration, the powers of the directors of the company in terms of dealing and/or transacting with the company’s assets have ceased, unless with the express permission of the Administrator.
“Moving forward, all matters, operational or otherwise, pertaining to the affairs of the Company shall be directed to the Administrator or their authorized representatives. The Administrator is currently engaging all key stakeholders of the Company to elicit their cooperation in order to achieve the best possible outcome for the Company. Creditors of the Company are required to send full particulars of any claims they may have against the Company to the undersigned on or before 23th April 2025.”
These developments come after Lipa Later raised Ksh 1.36 billion in funding in January 2022, to expand operations within its current markets of Kenya, Uganda, and Rwanda. Following the fund raised, the company’s Co-founder and CEO Eric Muli said “In the next 12 months we are looking to grow and double our presence in the existing markets, even as we open in three to five new markets in Africa”. However, the funds proved insufficient to stabilize its financial position.
As part of the administration process, creditors have been instructed to submit their claims by April 23, 2025. The appointed administrator is reportedly engaging with stakeholders to determine the best course of action for the company’s future, which may include restructuring or liquidation.
The company’s financial position came under scrutiny in December 2022, when it acquired the struggling e-commerce platform Sky. Garden for KES 250 million. The deal raised concerns about Lipa Later’s financial health, as it was already grappling with mounting obligations at the time.
What Went Wrong?
Reports reveal several challenges that impacted the fall of Lipa Later, which includes the following;
1.) Fierce competition from local giants like M-Pesa and M-KOPA
2.) Regulatory Pressures that increase compliance costs.
3.) Rapid expansion into new markets without tailored strategies
Founded in 2018, Lipa Later emerged as a major player in Kenya’s Buy-Now-Pay-Later (BNPL) space. It built its model around offering consumers the ability to purchase goods upfront and pay in installments, with Lipa Later handling the full payment to merchants. It wasn’t just a lender; it positioned itself as a consumer credit platform backed by proprietary data. The company uses a credit scoring and machine learning system that allows consumers to sign up and get a credit limit in seconds with no bulky documentation and a long lengthy credit approval process.
Notably, the BNPL company became one of the first African fintechs to receive SEC approval to raise funds from the general public in the U.S. In May 2024, it was listed in the Financial Times’ prestigious list of Africa’s fastest-growing companies, placing alongside industry leaders like M-KOPA, Quick Mart, and Kentegra Biotechnology.
Lipa Later’s downfall follows a troubling pattern in Kenya’s startup ecosystem, where high-profile companies collapse despite visible growth and funding milestones. Some examples are Twiga Foods and Sendy Sky. Garden, Kune Foods, amongst others.
Each of these companies had once been heralded as innovators disrupting their respective industries. From logistics to food delivery to urban mobility, their visions resonated with investors, partners, and the public. But volatile macroeconomic conditions, weak unit economics, unsustainable burn rates, and regulatory pressures continue to drive many into crisis. The outcome of Lipa Later’s administration will be closely watched by industry observers and stakeholders.