Kuda Technologies Limited, a Nigerian digital bank backed by global investors, has laid off employees across several departments as it restructures its operations, even as the company says its financial position has been improving.

On Wednesday, March 25, staff were invited to a company-wide video call with senior executives. Before the meeting ended, hundreds of employees were informed that their roles had been terminated as part of a broader restructuring, according to people familiar with the matter and online report.

The cuts affected multiple teams, including marketing, where 19 of the unit’s 40 employees were impacted, two affected workers said.

In a statement emailed on Friday, a Kuda spokesperson said the move followed a strategic review of the business and was meant to prepare the company for its next phase of growth.

“Kuda is evolving how the organisation is structured to support the next phase of our growth and scale,” the spokesperson said. The company added that the decision was not driven by financial pressure or employee performance but by changes in operational priorities.

Employees received notices explaining that the company had reviewed its future direction and industry benchmarks before deciding to reorganise some departments. The process, according to the company, was aimed at aligning its workforce with long-term goals.

Still, the way the layoffs were communicated unsettled some staff. An unusual company-wide meeting was scheduled earlier in the day, and several employees initially struggled to access the call link, according to a former employee. When the meeting began, senior leaders confirmed the job cuts.

Some workers also questioned the timing of the restructuring, pointing to recent hiring decisions, including senior-level recruits.

Kuda said it is offering affected employees severance packages that vary depending on role and length of service. According to a person familiar with the terms, some staff may receive up to seven months of pay. The company has also proposed enhanced exit packages tied to settlement agreements.

The layoffs come at a time when many African fintech companies are shifting focus from rapid expansion to profitability and operational efficiency after years of venture-backed growth.

Kuda, which has about seven million registered customers, has been narrowing its losses in recent years. The company reduced its losses to about $5.83 million in 2024 from $35.11 million a year earlier, helped by stronger performance from its Nigerian business and lower operating expenses.

Its Nigerian unit nearly doubled revenue in local currency to about N21.2 billion during the period.

Fintech has also reported strong growth in transaction activity. In its last public update, Kuda said it had processed more than 300 million transactions worth roughly N14.3 trillion and issued N16.4 billion in overdrafts, up 43 percent from the previous quarter.

Babs Ogundeyi, chief executive officer said the company’s net margin has ranged between three percent and seven percent per month. If that pace continues through the year, the digital bank could process more transactions in 2025 than it did in its first five years combined.

Kuda last raised external funding in 2024, securing $20 million in equity at a valuation of about $500 million. The fundraising came after the company recorded nearly $45 million in losses over the two years leading up to the round.

The restructuring suggests the startup is now adjusting its cost base and internal structure as competition intensifies in Nigeria’s fast-growing digital banking market and investors push fintech firms to show clearer paths to sustainable growth. (BusinessDay, excluding headline)