Allica Bank Acquires Kriya in SME Finance Push
Allica Bank has acquired Kriya, the SME lending and payments fintech, in a transaction that marks the challenger bank's entry into embedded finance and aims to deliver £1bn in working capital to small and medium enterprises over three years.
The acquisition brings together Allica's banking infrastructure with Kriya's PayLater and invoice finance platform.
Kriya has processed £4bn in transactions since launching in 2011 under its former names MarketInvoice and MarketFinance. The fintech has completed more than 300,000 transactions.
Kriya will maintain its brand and operate under the leadership of CEO and co-founder Anil Stocker. The entire Kriya team joins Allica as part of the deal.
Third acquisition for Allica
The transaction represents Allica's third acquisition since 2020. The bank previously purchased AIB's GB SME lending portfolio in 2021 and bridging finance provider Tuscan Capital in 2024. Allica's total outstanding lending to SMEs now stands at £3.5bn.
Allica opened for lending in 2020 and achieved profitability within three years. The bank offers current accounts with relationship managers and cashback alongside its lending products.
The acquisition forms part of Allica's target to reach 10% penetration of the established SME finance market by the end of 2028. The bank positions itself as an alternative to traditional high street banks in serving the segment, which accounts for a third of the UK economy.
Embedded finance integration
Kriya's PayLater solution is integrated with retailers including Halfords and operates through a partnership with Stripe. The embedded checkout finance product allows business buyers to access payment terms at the point of purchase.
The embedded finance capability represents new territory for Allica. Kriya has built integrations with B2B retailers that enable SME customers to access finance within existing purchasing workflows.
The platform provides invoice finance, SME loans and embedded PayLater options to businesses managing cashflow requirements.
Richard Davies, CEO of Allica Bank, says the combination addresses gaps left by traditional lenders.
“For too long SMEs have struggled to access the flexible finance they need as the high street banks have retrenched,” he says. “Allica is building something different – a better way to serve Britain's established SMEs.”
Davies says the businesses share an approach to SME lending. “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,” he says.
Market conditions
SME confidence in accessing funding has declined from 56% to 31% since 2019, according to Allica. One in ten SMEs now have access to bank overdrafts or traditional loans, marking the lowest level since 2019.
Traditional banks have reduced their presence in the established SME market over recent years.
Allica targets this segment with technology that enables what it describes as faster lending decisions. The bank's Business Rewards Account charges no monthly fees and assigns relationship managers to clients.
Kriya has provided working capital solutions to thousands of businesses across its operating history. The fintech's transaction volume demonstrates the scale of demand for alternative financing options among SMEs seeking flexibility beyond traditional banking products.
International expansion plans
Davies says the acquisition supports potential growth beyond the UK market. “This is our third acquisition but our first in the embedded payments space and it aligns well with our future potential international expansion,” he says.
Anil Stocker, CEO of Kriya, says the transaction provides infrastructure for scaling the business. “Combining forces with Allica gives us the right platform to scale what we've built,” he says. “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.”
Stocker says the timing reflects current economic pressures on SMEs. “There has never been a more relevant time to help SMEs survive a challenging and changing economic landscape,” he says.
Stocker says Kriya plans to extend its embedded finance offering into European markets.
“I'm excited about what we can achieve together, especially with our embedded finance offering, which we're looking to roll out across Europe soon,” he says. “Our customers will continue to get the same service and support from Kriya, but now with the backing and reach of one of the UK's fastest growing banks.”
