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Kenyan buy-now-pay-later (BNPL) fintech Lipa Later has officially entered administration as of March 24, 2025, following prolonged financial struggles and unsuccessful fundraising efforts. According to a gazette notice, Joy Vipinchandra Bhatt from Moore JVB Consulting LLP has been appointed as the administrator, assuming full control over the company’s assets and operations.
A Year of Financial Uncertainty
The company’s financial challenges have intensified since its last capital injection—a $3.4 million debt raise in September 2023—leaving it unable to meet financial obligations, including employee salaries and supplier payments. With creditors given until April 23 to submit claims, Lipa Later’s future remains uncertain.
“We are currently engaging all key stakeholders of the company to elicit their cooperation in order to achieve the best possible outcome for the company,” Bhatt stated.
At least five employees confirmed they had not received salaries for several months as of December 2024. The company also owes multiple suppliers, including London-based consultancy Africa Foresight Group (AFG), which sued Lipa Later in 2024 over an unpaid $13,516 consultancy fee.
Legal Challenges and Court Rulings
The dispute with AFG, which had been contracted in April 2022 for market research, escalated after Lipa Later refused to pay, citing poor-quality work. However, a December 2024 ruling by Kenya’s High Court dismissed Lipa Later’s defense, stating that the company had admitted to the debt in internal communications.
“It is therefore clear to me that the amount demanded in the statutory demand is, in fact, not disputed, and the debtor (Lipa Later) is estopped from claiming so having admitted to the debt,” Justice Mong’are ruled.
The court found that Lipa Later had failed to provide substantial evidence of a genuine dispute over the debt, further exacerbating its legal and financial woes.
From Investor Darling to Financial Distress
Lipa Later was once a rising star in Africa’s fintech space, attracting $12 million in seed funding in January 2022 from investors such as Cauris, Lateral Frontiers, Orbit Startups (2021), and Founders Factory Africa (2019). However, despite early investor confidence, the company failed to secure new funding in 2024.
A top executive, speaking anonymously, revealed that Lipa Later was close to securing a deal in Q4 2024, but it ultimately fell through.
Concerns over the company’s financial health heightened in December 2023, when Lipa Later acquired the struggling e-commerce platform Sky.Garden for KES 250 million ($1.9 million) despite its own growing financial obligations. The acquisition raised red flags among stakeholders regarding its long-term viability.
The Road Ahead
With Lipa Later’s operations now under the control of an administrator, potential outcomes include restructuring efforts or a sale to an investor willing to revive its BNPL business model. The fintech industry will be watching closely as the situation unfolds, determining whether Lipa Later can recover from its financial setbacks or face liquidation.
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