Rappi and R2 to Provide Loans to Restaurants in Mexico and Colombia

Rappi, a Latin American delivery app backed by SoftBank, is partnering with FinTech R2 to provide loans to restaurants in Mexico and Colombia.

Restaurants selling via the app for at least three months will be eligible for these loans, which will be repaid through their sales on the app, Bloomberg reported Thursday (July 27). Rappi aims to provide $60 million in loans.

Alejandro Solis, senior vice president for Rappi’s operations in Spanish-speaking Latin America, told Bloomberg that the company’s goal isn’t to get the margin but to enable restaurants to expand. “We win through commissions on the sales. So we gain if they sell more.”

The company’s new commercial lending program is initially targeting the app’s 50,000 restaurant clients in Mexico and 30,000 in Colombia, according to the report. It may then expand the program later this year to the other nine countries in which Rappi operates.

This move comes as Rappi is looking to add revenue streams and contend with competition from Naspers’ iFood and UberEats, the report said.

Rappi has already become a super app, delivering restaurant meals, groceries and consumer goods as well as offering an entertainment hub with games, music and live events.

Its partner in the new commercial lending program, the Mexico City-based lending platform R2, raised $15 million in a Series A funding round in September 2022. The firm said at the time that the new capital would allow it to conduct more hiring in the areas of engineering, product, data and risk, finance, compliance and partnerships.

R2 was founded in 2020 and makes a lending infrastructure that lets platforms offer capital to buyers and sellers in Latin America. In the year before its September 2022 funding round, the firm added new embedded lending partnerships, financed more than 3,000 small businesses and grew its monthly revenue 23-fold.

“We are just getting started — small businesses in Latin America still face a $1.2 trillion credit gap,” R2 Co-Founders Roger Larach and Roger Teran said when announcing the Series A. “As more businesses go online and transact digitally across the region, we are well positioned to leverage new data sources to further improve our underwriting capabilities.”