An Irish FinTech start-up which provides ‘micro-finance’ loans to Africa has raised a seed round Frontline Ventures and ACT Venture Capital.

Umba, which was started by former professional rugby play Barry O’Mahony and co-founder Tiernan Kennedy, secured the undisclosed funding to help the firm to meet the needs of the rapidly-growing African mobile payments and debt market.

O’Mahony played rugby professionally for four years with Munster, before setting up the start-up with ex-Saatchi & Saatchi computer engineer Kennedy.

Its smartphone banking app - which uses artificial intelligence to refine its lending algorithms - already has 170,000 customers in Africa, serving the needs of users who lack access to basic banking facilities.

The start-up has committed to helping the next 2 billion people progress into the formal financial world.

The latest funding will be used for salaries and the costs of running the platform.

“Traditional banking doesn’t work in developing markets for a number of reasons,” Kennedy told The Irish Times.

“Unfortunately, no bank account and no banking relationship means no credit rating, which leaves people in a pretty poor position when it comes to leveraging credit options.

“In Kenya, poor transport options, low average incomes and no bank in close proximity are all contributory factors to less than 40 per cent of the population having bank accounts.”