FinAccel Pte Ltd., a three years old Singapore-based startup company, received a capital expansion of $ 90 million, thus increasing its value to $ 500 million on December 3, 2019.
The company offers loans for online buyers in Indonesia through an app under the brand name Kredivo. Series C is the name of the company’s capital expansion.
According to the company’s CEO, Akshay Garg, South Korea’s Mirae Asset-Naver Asia Growth Fund and Australian’s venture capital firm Square Peg are the key financiers for the Series C funding. Other companies namely, Singtel Innov8, Telkomsel Indonesia, Cathay Innovation, and Kejora Intervest have also taken part in the funding.
Reasons for FinAccel’s Kredivo Popularity in South Asia
Through data analytics, a technology that can access the digital footprints of the users, the company instantly approves a customer if he/she is eligible for a loan, which was applied through the Kredivo app.
The company charges customers interest on credit after 30 days, which increases by 2.95% per month and more than 40% annually.
Despite the high-interest charges, the company’s popularity is rising in Indonesia and other parts of Southeast Asia, as it grants easy access of credits to the customers in the region, thereby solving the existing problems of non-availability of loans from the banks.
Southeast Asia has more than 600 million people and 70% of the adult populations cannot gain access to the banks.
As reported by Bain & Co., “Of the 400 million adults in the region, 98 million are ‘under-banked’ — people with bank accounts but limited access to services such as credit. Another 198 million have little recourse to finance whatsoever.”
Akshay explained the objective of lending credits to the customers, “Our goal is to create a generation of financially savvy individuals and lend to them at competitive interest rates. The goal here is not to be a loan shark. This is about financial inclusion for the masses”.
Striving for Various Development in Indonesia
Since its establishment in 2016, the company has offered almost 30 million loans to customers. According to Akshay, “The company as more than 1 million regular customers and is growing by 300 percent each year.
Besides that, the company is able to accumulate its capital more than $ 200 million for the year 2019 alone through its share in debt and equity.
Currently, the company, with the support of the Indonesian Government, plans to increase its credit services for the fast-growing middle-class population in the country.
Moreover, FinAccelPte Ltd. aims at providing financial services through Kredivo to nearly 10 million in various sectors, including lending low-interest credit for education and health care. To accomplish these various developments, the company is expected to work with multiple banks and investors partners.
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