Kreditech, a Hamburg-based fintech company which operates in the field of consumer financial services, has raised €10 million from International Finance Corporation (IFC), part of World Bank Group.
Kreditech will use IFC’s funding primarily to invest in its Monedo platform. The platform provides both credit and digital banking products to underbanked consumers in emerging and developed markets. The German fintech company aims to further improve the borrowing conditions for its customers and continue its transition towards lower-interest, sustainable credit products. In the context of the investment, Kreditech and IFC have further developed the company’s vision for financial inclusion, agreeing on clear guidelines for a “Responsible Lending Policy”.
Kreditech co-founder Alexander Graubner-Müller took over the CEO position from Sebastian Diemer in November of 2015. In regards to Kreditech’s business model and the recent funding, he explained: “Most of our customers are not able to obtain credit at traditional banks. These institutions lack proper credit scoring for this segment and are unable to assess the customer risk. Through Kreditech’s technology we can perform a more precise credit rating to offer credit at fair and risk-weighted conditions. With the new funding, we will continue advancing our scoring technology to continuously improve and expand our product offering.”
Rene Griemens, Chief Financial Officer of Kreditech, stated: “We welcome IFC as a very valuable partner which brings our Series C round to a total volume of €92.7 million. With its strong banking expertise in the developing world, IFC reconfirms our investment hypothesis and will help to roll out our financial inclusion strategy for the underbanked.”
The round was led by J.C. Flowers & Co., Peter Thiel, Amadeus Capital Partners and existing shareholders Värde Partners, Blumberg Capital and HPE Growth Capital.
Kai Schmitz, principal investment officer of IFC, said: “The company has developed a strong approach to improve customer’s credit ratings and help them enter into the financial system. In line with our belief that financial services are key to long-term economic growth, we are happy to reaffirm Kreditech’s business model with our investment.”