Nairobi-Based Flowt Secures Pre-Seed Funding to Scale AI-Powered Lending for African Climate SMEs

Flowt, a fintech startup based in Nairobi, has successfully raised pre-seed funding to expand its AI-driven lending services to climate-focused small and medium-sized enterprises (SMEs) across Africa. The funding round saw participation from Delta40 Fund I, Impacc, and Argidius Foundation. Flowt has already issued its first working capital facility to GreenBay, a Kenyan firm specializing in refurbished appliances and solar home systems.

The core innovation of Flowt lies in its use of artificial intelligence to analyze alternative financial data, such as bank accounts, mobile-money records, and accounting systems. This approach allows the company to assess the creditworthiness of businesses based on their transaction history, circumventing the need for traditional collateral or lengthy due diligence processes that often hinder African SMEs from accessing formal financing. This addresses a significant challenge for small businesses in Africa, where traditional lenders often find it uneconomical to underwrite smaller loans or demand collateral that SMEs lack.

The startup plans to leverage this new capital to further develop its financial data assessment platform and broaden its lending operations, initially focusing on Kenya. Flowt aims to reach a loan book of $1 million by the end of 2026, specifically targeting climate-smart businesses. Beyond lending, the company intends to generate revenue through software subscriptions for businesses and financial intelligence tools for investors, with a long-term vision of building a comprehensive financial data layer for African climate-focused SMEs.

This development is particularly significant given the substantial financing gap faced by African SMEs, estimated at around $330 billion annually, despite their critical role in contributing over 40% of GDP and employing nearly 80% of the continent's workforce. By providing a pathway to verifiable financial records, Flowt seeks not to replace commercial banks but to enable businesses to become transparent and measurable enough to eventually qualify for conventional financing, thereby fostering growth in the burgeoning African climate technology sector.