Indonesia’s P2P lender Modalku, which operates as Funding Societies in Singapore, has raised $40 million in a Series C round from undisclosed existing and new investors, the company announced on Thursday.
The company will use the proceeds to improve user experience and to benefit Modalku users, both borrowers and lenders. The funding will also be used to support MSMEs, which are affected by COVID-19, through restructuring options and accelerate certain sectors that need funding such as healthcare.
So far, Modalku has disbursed loans of more than Rp 14 trillion ($895 million) for MSMEs in Indonesia, Singapore, and Malaysia. Indonesia accounted for around 60 per cent of the total loan disbursement.
“Amid the global pandemic, we are very grateful to gain trust from investors. The funding will support the company’s strategy and for us to continue to support MSMEs,” Modalku co-founder & CEO Reynold Wijaya said in a statement.
According to the company, the retail business has been hit hard amid the pandemic, however, only 1 per cent of the firm’s active borrowers are seeking loan restructuring.
The firm’s non-performing loan stood at 0.8 per cent, below the 5 per cent limit set by the Financial Services Authority (OJK) for the industry.
“Our NPL level can still be integrated as there are other MSMEs and business sectors that still be able to grow and require support,” Modalku co-founder & COO Iwan Kurniawan.
Recently in December, the firm raised an undisclosed amount in debt funding from global impact investor Triodos Investment Management. It also invested in Indonesian SaaS startup Paper.id.
Modalku had secured $25 million in Series B funding in 2018 from SoftBank Ventures Korea, Sequoia India, Alpha JWC Ventures, and Golden Gate Ventures.