Kreditech, a German financial technology company, recently announced that it raised EUR 10 million (USD 11.2 million) as part of its Series C funding round from the International Finance Corporation (IFC), a member of the US-based World Bank Group, to invest mainly in its Monedo platform, which provides on-line banking products to consumers in both emerging and developed markets.The other Series C investors are Värde Partners, Blumberg Capital and HPE Growth Capital. This brings Kreditech’s total Series C funding to EUR 92.7 million (USD 103.6 million).
By investing in Monedo, Kreditech hopes to improve the borrowing capability of its customers, who generally would not have qualified for credit from traditional banks. The Monedo platform unifies a range of Kreditech’s products, such as short- and long-term loans, lines of credit, personal finance management services and eWallets (secure online environments where customers can store multiple credit card and bank account numbers). Rather than relying on repayment history, Kreditech makes credit decisions by analysing customers’ online behaviour, including social media activity.
By Imke Herholdt, Research Associate
About Kreditech
Founded in 2012, Kreditech is a consumer finance technology company based in Hamburg, Germany, that assesses the creditworthiness of loan applicants based on social media usage and other online behaviour. The company employs approximately 300 people and operates predominately in Poland, Spain, the Czech Republic, Mexico and Russia. Its product offerings include microloans, digital wallets, and virtual and prepaid credit cards. The company has processed approximately 3 million loan applications. Kreditech does not report to the US-based nonprofit Microfinance Information Exchange (MIX). Its shareholders as of March 2016 are Amadeus Capital Partners, Blumberg Capital, HPE Growth Capital, The International Finance Corporation (IFC), Peter Thiel and Värde Partners. The company has raised close to USD 150 million as of March 2016.
About the International Finance Corporation (IFC)
The International Finance Corporation (IFC), a US-based member of the World Bank Group, offers loans, equity investments, advisory and risk mitigation services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of December 2014, IFC has 184 member countries that drive its policies and approve disbursements. As of the same date, IFC reported total assets of USD 84.1 billion, net income of USD 1.48 billion and return on assets of 1.8 percent.
Sources and Additional Resources
[1] The PE Hub Network, ”Kreditech raises $11.2 mln”
[2] Bankless Times, ”World Bank Group arm bets big on Kreditech”
[3] Tech Crunch, ” Kreditech Nabs $92M To Build Financial Services For The ‘Underbanked”’
[4] Tech Crunch, ”Online lender Kreditech closes out Series C at $103M after getting $11M from the IFC”
[4] Financial Times, ” Kreditech: A credit check by social media”
MicroCapital Universe Profile: International Finance Corporation (IFC)
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