Kenyan fintech CredResolve has raised an undisclosed sum in a pre-Series A funding round led by Merak Ventures, the company announced on Thursday. The Nairobi-based startup, which operates a digital platform for debt collection and recovery, said the new capital will be used to develop its technology and expand its services across East Africa.

The funding round included participation from other investors, though CredResolve did not disclose their names. The company stated that the investment will support the development of its core platform, which uses data analytics and machine learning to facilitate more efficient debt recovery processes for financial institutions and other creditors.

Founded in 2022, CredResolve positions itself as a technology-driven intermediary in the credit lifecycle, aiming to improve recovery rates while maintaining regulatory compliance and consumer protection standards. The company operates in a market where non-performing loans remain a persistent challenge for lenders across the continent, often constraining credit access.

Merak Ventures, the lead investor, is a venture capital firm with a focus on early-stage technology companies in sectors including fintech, enterprise software, and consumer internet. The firm has previously backed other African startups, though it did not provide specific commentary on the CredResolve investment in the announcement.

The funding for CredResolve arrives amid continued investor interest in African fintech infrastructure companies that address specific pain points in the financial system. In recent weeks, other startups have also secured capital, though for different verticals. Littlefish, a platform providing merchant infrastructure services to banks, raised $9.5 million in a Series A round. Separately, Kulipa, which provides stablecoin infrastructure and is a partner to payments giant Flutterwave, secured $6.2 million in a seed round led by Flourish Ventures.

CredResolve's focus on the back-end of credit aligns with a broader trend of fintechs building specialized solutions for financial institutions, rather than competing directly with them. The Kenyan market, a hub for fintech innovation driven partly by the success of M-Pesa, presents both opportunity and regulatory scrutiny for companies operating in the debt collection space.

The company did not specify a timeline for its regional expansion but indicated that East Africa is its initial target. The success of its model may depend on its ability to navigate varying regulatory frameworks and credit cultures across different countries while demonstrating tangible improvements in recovery outcomes for its clients.