Financial Inclusion

Kreditech Raises $92M To Serve The Underbanked

A company looking to bring financial solvency to others has gotten a boost of its own.

Consumer finance technology company Kreditech announced yesterday (Sept. 28) that it has raised $92 million in Series C financing. Based in Germany, Kreditech is in the business of creating credit and banking products for customers with little to no credit history.

The Series C round was led by J.C. Flowers & Co. LLC, which was joined by Värde Partners, HPE Growth Capital and Blumberg Capital. A press release notes that a bridge loan contributed to earlier in the year by Peter Thiel and Amadeus Capital Partners has now fully converted into Series C equity, as well as the fact that Kreditech is in discussions for a final closing that could increase the round to over $112 million.

“We are excited to bring these world-class investors on board who will support us in strengthening our integrated financial services platform, bringing us closer to our vision of becoming the ‘digital bank for the underbanked,’” said Kreditech Cofounder and CEO Sebastian Diemer in the release. “We are a technology company but also a provider of consumer financial services, and we are fortunate to have a sophisticated shareholder group whose experience and network spans both areas.”

“We view the addition of J.C. Flowers, Peter Thiel and Amadeus as a major validation of our business model. They are important partners in building our capital markets story,” said Kreditech CFO Rene Griemens. “The company has now raised cumulative equity and debt funds of more than €300 million, of which €160 million are unused debt facilities available to finance further growth.”

Loren Felsman of J.C. Flowers — who, the release notes, will join the company’s board — stated, “There are people without access to fair and affordable credit in every market we have analyzed, and technology is enabling new and better ways of offering credit to these customers. Kreditech has developed a remarkably sophisticated approach to real-time consumer banking and focuses on markets that are relatively less well-served by traditional credit bureaus and financial services providers. Most lenders, including those built on modern technology, may not crack these markets for years.”

“We are very impressed by Kreditech’s speed of execution; its business model, in combination with its innovative scoring and underwriting technologies, has enormous potential to overtake traditional banking models in the future,” added Andrea Traversone, an Amadeus partner.

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