Modalku, an Indonesian peer-to-peer (P2P) lending platform, has raised an undisclosed amount in debt funding from global impact investor Triodos Investment Management, the company said in a statement.
The transaction has been routed through Triodos Microfinance Fund and Triodos Fair Share Fund, financial inclusion funds managed by Triodos Investment Management.
Modalku will use the proceeds to widen its credit access for micro, small, and medium enterprises (MSMEs) in a bid to promote financial inclusion in the region.
“The funding from Triodos Investment Management marks a new milestone for us…going forward, we want to reach far more MSMEs. We believe that expanding credit access will not only drive MSME growth but also benefit the economy and our societies,” Modalku co-founder and CEO Reynold Wijaya said in a statement.
With around 63 million businesses, potential in the Indonesian MSME market is enormous. However, according to a study conducted by financial consultant firm PwC, as much as 74 per cent of the MSMEs still don’t have adequate access to financing.
Established in 2016, Modalku connects creditworthy but unbanked MSMEs in Southeast Asia with retail and institutional lenders. The startup, which enables fast working capital loans and competitive interest rates, also operates in Singapore and Malaysia, under the name, Funding Societies.
Funding Societies has provided loan of around EUR 650 million to more than 1.1 million MSMEs across Southeast Asia.
Triodos Investment Management, which is a subsidiary of Netherland-based sustainable bank Triodos Bank NV, has provided capital to host of financial institutions across the globe, with an investment portfolio of over EUR 900 million.
In 2016, Modalku had raised $1.2 million from Alpha JWC Ventures and a number of undisclosed foreign venture capital investors. Recently, Modalku invested in Indonesian SaaS startup Paper.id.