This move transferred control of the company’s operations and assets to Bhatt, effectively ousting the previous management.
This development follows a period of financial instability for Lipa Later, despite a recent KSh 1.36 billion ($9.88 million) funding round intended for African expansion. Reports indicate months of unpaid employee salaries, outstanding supplier invoices, and escalating legal disputes.
Key legal challenges include a lawsuit filed by Africa Foresight Group (AFG) for unpaid consultancy fees, which Lipa Later lost despite claiming substandard work. The Kenyan High Court ruled against Lipa Later, citing internal emails acknowledging the debt. Additionally, Lipa Later faced accusations of trade secret misappropriation by a former employee who joined competitor Craft Silicon Kenya.
The company’s acquisition of the struggling eCommerce platform Sky.Garden for KSh 250 million ($1.9 million) in December 2023 further strained its finances, raising questions about its financial management.
Bhatt’s immediate task is to assess Lipa Later’s viability, with creditors required to submit claims by April 23, 2025. Potential outcomes include restructuring, asset sale, or liquidation.
Simultaneously, Odyssey Capital, a digital lending firm, has also entered administration, highlighting systemic risks within Kenya’s fintech sector.
The Insolvency Act 2015 triggered these administration proceedings, resulting in:
The insolvency of these major Buy Now, Pay Later (BNPL) and digital lending players raises significant concerns for consumers, merchants, and investors.
Market Volatility: Driving Reforms in African Financial Sectors
