By Oliver Smith on 9th September 2019
Financial technology startups across Asia and Latin America are raising big funding rounds.
Goldman Sachs has backed Mexican fintech startup Konfio with a $100m credit facility to super-charge its SME lending business over the next 12 months.
At the same time in India Bangalore-based digital bank YeLo last week announced its seed funding round with plans to grow to 100 employees over the next 18 months.
“This segment that we are targeting is around 8-10-crore [80-100 million] strong and works for small corporate entities or with aggregators like food-delivery platforms, taxi services and others. There is a huge opportunity in providing financial services to them,” said Nilesh Agarwal, founder of the 0.5Bn FinHealth Group which owns YeLo.
The digital bank is targeting financial services for gig economy workers in India, with new investors in YeLo’s round including Matrix Partners India, Omidyar Network India, Flourish and current investor, Better Capital.
The size and valuation of YeLo’s round were not disclosed, but in recent months rival Indian digital banks Open and NiYO have raised $30m and $35m respectively.
In Mexico Konfio currently offers unsecured lending with an average value of $20,000 to SMEs, but said the new funding will enable it to start lending against collateral to increase its loan size.
Over the next year Konfio founder David Arana told Bloomberg the funding will enable $250m of lending to Mexican businesses.
“Konfio brings a unique approach to credit underwriting for a segment of the market that’s poorly served in Mexico and more broadly across the region,” Ram Sundaram, who heads Goldman’s structured-finance, investment and lending business globally, told Bloomberg.