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Kapital Raises $165 Million to Expand Banking Platform


Banking and technology platform Kapital has raised $165 million in new capital.

The Mexico City-based company announced the funding — a $40 million Series B equity financing round and $125 million in debt financing — in a news release Thursday (Dec. 14), saying it plans to invest the money in its cross-border offering and expand its product suite.

“With these developments, Kapital is building a vertically integrated tech platform stretching beyond its current reach of loans, credit cards, invoicing and expense management — into payroll and benefits services, as well as treasury accounts,” the release said.

According to the release, Kapital uses data and artificial intelligence (AI) to provide small and medium-sized businesses (SMBs) in Latin America (LatAm) with enterprise technologies it says is normally only available for large corporations, letting SMBs see and manage their cash flow in real-time dashboards.

The company says it already uses AI to underwrite loans to SMBs, which make up 90% of the world’s businesses, yet in Mexico account for just 10.5% of available business bank credit.

“Our recent funding round will propel us forward as we embark on an exciting expansion across Latin America and beyond,” Kapital Co-founder and CEO Rene Saul said in the release. “Over 80,000 customers already entrust us with the financial health of their businesses, and we are introducing more AI-driven products while pushing into new markets.”

The funding round comes at a time when SMBs are struggling to find funding. Research by PYMNTS Intelligence has found that just 47% of SMBs recording yearly revenues of $10 million or less had access to business or personal financing as of July 2023.

In addition, 53% reported having “no current access to credit.” It’s a problem most acutely felt among the smallest companies, those with annual revenue of $150,000 or less.

Meanwhile, a majority of mid-sized companies in Latin America and the Caribbean (LAC) are tapping into working capital solutions to improve growth, according to “The 2023-2024 Growth Corporates Working Capital Index: LAC Edition,” a PYMNTS Intelligence and Visa collaboration.

That report found that 94% of LAC mid-sized companies plan to access external working capital solutions next year for growth investments.

“The range of working capital solutions is broad and diverse, but some emerged as preferred options,” PYMNTS wrote last month. “For instance, working capital loans were cited by 31% of mid-sized company CFOs as very likely solutions to use the next year. Additionally, 17% cited bank lines of credit and 11% third-party revolving facilities.”