Nigerian Fintech Lidya Ceases Operations Amidst Founder Discord
Lidya, a Nigerian fintech startup providing digital lending services to SMEs, has shuttered its operations after facing financial difficulties and internal governance conflicts. The company, which secured over $16 million in funding from prominent impact investors such as Alitheia Capital, Accion Venture Lab, and Flourish Ventures, announced its inability to fulfill financial obligations or disburse funds to customers. This closure follows months of user complaints regarding frozen balances and unsuccessful transactions.
Internal Conflicts and Insolvency
Founded in 2016 by ex-Jumia executives Tunde Kehinde and Ercin Eksin, Lidya aimed to broaden credit access for small and medium-sized businesses across Africa. Initially successful, the company later expanded into Europe to seek enhanced revenue streams. However, internal harmony declined, and disagreements at the board level arose as the company prioritized scaling during a challenging funding landscape, ultimately leading to insolvency.
The shutdown of Lidya highlights the challenges faced by fintech companies in Africa, particularly the importance of strong governance and internal alignment, especially when navigating difficult economic climates. The company’s inability to reconcile internal conflicts ultimately undermined its mission of supporting SMEs through digital lending.
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