Lipa Later’s Failed Bid for Nigeria’s Klump Exposes Cracks in BNPL Ambitions

In late 2022, Kenya’s buy-now-pay-later (BNPL) fintech Lipa Later, now under administration, made a bold move to acquire Nigerian startup Klump, aiming to cement its dominance in Africa’s BNPL market. However, the deal collapsed due to trust issues and a lack of transparency, offering a cautionary tale about the challenges of fintech mergers in Africa’s volatile tech landscape, according to sources familiar with the matter.

The courtship began with meetings in Nairobi, where Lipa Later proposed a three-phase fundraising plan: a $2 million raise to stabilize operations in Kenya and Nigeria, another $2 million in late 2024 for North American expansion and debt repayment, and a $15–20 million Series A by 2025 at a $100 million valuation. Klump’s team, led by co-founder Celestine Omin, was open, sharing detailed portfolio and market plans. In contrast, Lipa Later, under co-founder Eric Muli, remained guarded, failing to provide full financial disclosures, which deepened skepticism, a transaction advisor revealed.

This lack of transparency stalled negotiations by early 2024. Klump walked away as doubts about Lipa Later’s financial health grew. By mid-2024, Lipa Later’s Nigerian operations had shut down, and its Kenyan transactions dwindled amid a fading BNPL market. The startup’s failure to pay suppliers, including a $13,516 consultancy fee to Africa Foresight Group, led to a lawsuit and its eventual slide into administration in March 2025, with Joy Vipinchandra Bhatt of Moore JVB Consulting appointed to oversee its fate.

Lipa Later’s ambitious expansion vision—to consolidate Nigeria and Kenya in 2024, enter North America, and later target Ghana, Uganda, Tanzania, and beyond—lacked a clear growth strategy, appearing more like financial maneuvering to mask existing weaknesses, the advisor noted. Muli disputed this, claiming Klump wasn’t ready for acquisition and highlighting Lipa Later’s $10 million raise post-talks.

Klump’s wariness proved prudent. By late 2024, Lipa Later’s promised $25 million Series A never materialized, and creditors began filing for insolvency. Engage Capital has since offered $24.5 million to acquire Lipa Later’s technology, customer base, and licenses, while the company seeks a $5 million lifeline from UK-based Africa Global Capital.

“This was due diligence doing its job,” an investor said, underscoring the risks of high-stakes bets in Africa’s tightening funding environment. Lipa Later’s collapse, alongside other Kenyan startups like Sendy and Copia, highlights the BNPL sector’s vulnerability to economic downturns and fierce competition from players like M-Kopa and PayQart. With African startup funding rebounding to $1.42 billion in 2025, the saga underscores the need for transparency and resilience in navigating the continent’s dynamic tech ecosystem.