There are quite a lot of choices of digital credit platforms that people can choose today. Each offers attractive benefits, and no less important, the financing process is easy. One that is currently developing is Kredivo, which provides a platform for leading retail consumers in Indonesia.
This week (11/24), Kredivo announced a partnership with an investment company based in Chicago, United States of America, namely Victory Park Capital Advisors, LLC (“VPC”). The company will provide credit line funding of up to USD 100 million, which will later be distributed to all Kredivo users in Indonesia. This collaboration marks an important chapter for both companies.
Kredivo Receives VPC’s First Investment in Southeast Asia
For Kredivo, this credit line funding is the largest in the company’s history, as well as the largest in the fintech industry in Southeast Asia. As for VPC, this funding marks their first investment in the Southeast Asian market. Funding has been completed as of the third quarter of 2020.
The cooperation between the two companies will further boost business growth momentum and strengthen Kredivo’s risk matrix, even in the midst of challenging economic conditions. In the future, Kredivo will utilize the lines of credit obtained to develop and diversify the loan book, all of which come from third party funds.
VPC itself has been established since 2007, investing in large companies as well as emerging business segments in various industries globally, which often do not have access to traditional sources of capital. The differentiation offered is its extensive business network, consistent cooperation, creative financing capabilities, broad credit structure and expertise in a number of other specialized areas.
In a release, Gordon Watson as a partner at VPC said that Kredivo was able to show a unique combination of growth, market reach, risk management and financial inclusion in Indonesia. “Of course, it is very exciting to be able to start this important chapter with a partner of Kredivo’s caliber, with extraordinary enthusiasm in expanding access to credit that is affordable to the wider community.”
This is an achievement for Kredivo during the pandemic
On the same occasion, Umang Rustagi as the co-founder of Kredivo emphasized that large credit line funding from VPC will accelerate business scalability, and realize Kredivo’s target to serve up to 10 million new users in the next few years.
“The large number of credit lines obtained by Kredivo, especially in the midst of the current pandemic, is an important breakthrough for the fintech industry and ecosystem in Indonesia,” said Umang. Yes, not only for Kredivo, this transaction is also an important momentum for Indonesia’s digital credit ecosystem, even Southeast Asia.
Until now, credit card penetration is still at 3 percent. Coupled with the limitations of conventional financial institutions in distributing unsecured credit, the existence of digital credit such as Kredivo is able to bridge the credit gap in the country.
The collaboration between Kredivo, which already operates as a multi-finance company, and VPC marks a deviation from the general standard, as well as a positive signal for the strengthening of the credibility of developing fintech players. Throughout 2020, Kredivo has also released research on consumer activity in e-commerce in August, as well as the release of the digital financial literacy movement “Generation Djempolan”.