Allica Bank has announced that it has acquired Kriya, a SME lending fintech specialising in SME working capital and Embedded Finance.
Through this move, Allica Bank aims to further improve its SME lending proposition and include Kriya in the UK’s embedded payments market. The two companies fit from a strategic business perspective and, combining their capabilities, will optimise lending and payments, as they will continue to focus on leveraging technology to augment the established SME market.
Kriya comes as Allica’s third acquisition, with the company previously purchasing and integrating AIB’s GB SME lending customers in 2021 and bringing Tuscan Capital in 2024.
How does Kriya’s acquisition fit into Allica’s development strategy
Currently, Allica Bank is working on expanding its working capital and Embedded Finance offering. This comes during a period when confidence among SMEs looking for funding has decreased substantially, from 56% to 31% since 2019. Additionally, only one in ten SMEs has access to bank overdrafts or traditional loans, which is the lowest recorded level since 2019. According to its data, since introducing its lending services in 2020, Allica has grown considerably, with its total outstanding lending to SMEs reaching GBP 3.5 billion.
By acquiring Kriya, Allica aims to target advancing an initial GBP 1 billion of working capital finance to SMEs until 2028. At the same time, the deal is set to accelerate Allica’s mission to penetrate 10% of the established SME finance market by the end of the same year, replacing the legacy high street banks, which, according to the company, have not served this segment that makes up a third of the UK economy.
Furthermore, the agreement will see Kriya continuing to operate under its own brand, which holds a solid position in the SME finance market. The leadership will also remain unchanged, while Kriya’s employees will join Allica as part of the deal. Commenting on this move, representatives from Kriya stated that, by joining forces with Allica, the company gains the platform to scale its operations even further. Both companies are committed to improving SME finance and serving the unmet needs of the market. They added that customers will continue to benefit from the same service and support from Kriya, but with this acquisition, they will also receive the backing and reach of Allica Bank.
