Indonesian digital credit platform Kredivo has closed a debt facility of up to $100 million from Chicago-headquartered private credit firm Victory Park Capital Advisors (VPC), according to an official announcement.
This marks Kredivo’s largest-ever deal with a credit provider. The deal also marks VPC’s first transaction in Southeast Asia.
Last year, Kredivo announced the closing of a debt facility of $20 million from venture debt firm Partners for Growth to fund loans for the startup’s borrowers in Indonesia.
Kredivo will use the proceeds from the latest transaction to grow and further diversify its loan book, all of which is third party generated.
“The large capital pool made available via this facility will enable the business to scale even further and get us closer to our goal of serving up to 10 million customers in Indonesia over the next few years,” said Kredivo co-founder Umang Rustagi.
Operated by fintech company FinAccel, Kredivo provides customers in Indonesia an instant credit financing for e-commerce and offline purchases and personal loans. Its users can ‘buy now and pay later’ at low-interest rates, while its merchant partners benefit from instant point-of-sale financing.
With less than 3 per cent of Indonesia’s 260-million population in possession of a credit card, and banks historically cautious about providing unsecured credit to the mass market, digital credit providers such as Kredivo have been making efforts to fill the gap.
In the digital credit services space, Kredivo competes with Sequoia-backed Akulaku, which raised a Series C funding round of $70 million in 2018.
While Kredivo and Akulaku see little direct competition in Indonesia, from the demand side, they compete with P2P consumer lending players like UangTeman, while several online marketplaces and payment startups like Tokopedia, Traveloka and OVO have also developed their own PayLater feature.
Kredivo raised one of the largest funding rounds raised by a non-unicorn company in the region when it bagged a $90 million Series C in December 2019 co-led by South Korea’s Mirae Asset-Naver Asia Growth Fund and Australian venture capital firm Square Peg. The round reportedly pegged Kredivo’s valuation at almost $500 million.
Other investors on Kredivo’s cap table include Singtel Innov8, Telkomsel Indonesia, MDI Ventures, Cathay Innovation, DST Partners and Kejora Intervest.
