Kwara, a Kenyan neobank, has announced the acquisition of IRNET, a software provider owned by the national body of credit unions in Kenya, the Kenyan Union of Savings and Credit Cooperatives (KUSCCO), and a seed extension of $3 million. This brings Kwara’s total seed investment to $7 million.
Since raising $4 million in seed funding led by Breega and Softbank thirteen months ago, Kwara has grown its neobank user base by 35x, seen a 120x jump in monthly app transactions, surpassed over 120 billion Kenya shillings in cumulative transactions processed on their core banking platform, and now serves more than 120 credit unions. Over 25 billion Kenya shillings has been securely and rapidly disbursed in fair loans using the Kwara platform, leading some of Kwara’s credit union clients to triple their membership base and win awards such as “Most Improved Nationwide”.
The acquisition of IRNET and the KUSCCO-Kwara partnership will enable Kwara to offer its banking-as-a-service solution and neobanking experience to KUSCCO’s 4,000+ credit unions, consolidating credit union banking as the preferred retail banking method in Kenya. Kwara has also entered into an exclusive digital solutions partnership agreement with KUSCCO.
Kwara CEO, Cynthia Wandia, said: “We have spent the last three years uplifting the credit union sector in Kenya, becoming the leading core banking provider in Kenya. Our clients grow up to 4 times faster than other credit unions and serve members up to 100 times more efficiently. This acquisition enables us to place a digital banking experience in the hands of every credit union in Kenya, together with the most established credit union partner in Kenya.”
The startup has continued to ship compelling features to attract larger, more capitalized credit unions while continuing to offer banking grade service that a small or midsize credit union can afford. This is fortuitous timing, as the incoming government of Kenya has committed 250 billion Kenya shillings over the next five years to be disbursed as low-interest loans to the public through financial intermediaries such as credit unions.
George Ototo, Group Managing Director of KUSCCO, said: “This development marks a game changer in the management of credit unions going forward. The acquisition of IRNET and the KUSCCO-Kwara partnership will deliver to our 4,000+ member credit unions tested and proven, secure and efficient digital services as well as a modern neobanking experience.”
The entire IRNET team will join forces with Kwara to ensure a seamless transition and to embed the entire KUSCCO regional network of 16 branch offices and several hundred marketers and marketing expertise into Kwara.
Kwara’s mission is to bring financial health to all, and strongly believes that credit unions or savings cooperatives are the fastest way to get there. Their vision is to make a credit union account the primary account for 30 million people by 2025, and by 2032 to make credit union banking the standard for 1 billion people in 15 emerging markets.
In summary, Kwara has announced the acquisition of IRNET, a software provider owned by the national body of credit unions in Kenya and has raised an additional $3 million seed extension, bringing the total seed investment to $7 million. This acquisition will enable Kwara to offer its banking-as-a-service solution and neobanking experience to KUSCCO’s 4,000+ credit unions, consolidating credit union banking as the preferred retail banking method in Kenya and the entire IRNET team will join forces with Kwara to ensure a seamless transition.
