Allica Bank snaps up UK embedded finance startup Kriya

Allica Bank, the UK challenger lender for SMEs, has acquired UK business lender and embedded payments startup Kriya, as the challenger lender moves into offering payment services to non-financial services businesses.

Allica, which offers lending, business banking and savings services to SMEs with over 10 employees, said the all-share deal for Kriya strengthens its lending offering and represented a “strong strategic fit”.

Since it started lending in 2020, Allica has lent around £3.5bn to SMEs, and said it was now targeting £1bn in working capital finance to SMEs over the next three years, bolstered by the Kriya acquisition.

Kriya offers its customers, which include retailer Halfords, embedded payments, which can be described as the integration of payments into non-financial services businesses, as well as business lending.

Since launching in 2011, Kriya (formerly known as MarketInvoice and MarketFinance) has processed over £4 billion in invoice finance, SME loans and embedded finance.

Financial details of the deal have not been disclosed. The acquisition marks Allica’s third to date, following the purchase of Allied Irish Bank's SME lending customers in 2021 and bridging finance specialist Tuscan Capital in 2024. 

Kriya will continue to operate under its own brand with CEO and co-founder Anil Stocker leading the business, with Kriya's 30 employees joining Allica's 680 employees.

Allica last undertook a funding round in 2022, raising a £100m Series C led by TCV, with participation from investors Warwick Capital Partners and Atalaya Capital Management.

Kriya is backed by investors including Northzone, Barclays, Santander, and Cogito Capital Partners.

Richard Davies, CEO of Allica Bank, said: "Kriya has built an impressive business over more than a decade, and Anil and his team share our belief that SME finance needs reinventing, and that together we can offer something the market desperately needs.

"Our ambition is clear. We plan to lend £1 billion of working capital finance to SMEs over the next three years. This is our third acquisition but our first in the embedded payments space and it aligns well with our future potential international expansion.”

Stocker said: “Combining forces with Allica gives us the right platform to scale what we've built. We share the same DNA – a genuine commitment to reinventing SME finance and competing with the big banks who've walked away from the SME market.”