INSUBCONTINENT EXCLUSIVE:
Funding Societies co-founders Reynold Wijaya and Kelvin Teo.Funding Societies, a peer-to-peer lending platform in Southeast Asia, said today
and Alpha JWC Ventures, as well as new backers Qualgro and LINE Ventures.Funding Societies also said it has raised credit lines from banks
and financial institutions to lend to small- to medium-sized businesses
Series B was oversubscribed, says Funding Societies, which operates in Singapore, Indonesia, where it is called Modalku, and Malaysia.When
it announced its $7.5 million Series A in August 2016, Funding Societies had disbursed $8.7 million Singaporean dollars, a number that has
since grown to $145 million SGD, chief executive officer Teo tells TechCrunch
Since its launch, the startup has increased its lender base to more than 60,000 and now claims a default rate of less than 1.5%, down from
about 2% to 3% two years ago, thanks to improvements in its underwriting model.In a press statement, Softbank Ventures Korea partner and
SME digital lending across Southeast Asia is where we saw huge growth potential
Among many players, we were most impressed with Funding Societies for what it has achieved in a short period of time and its potential to
collect them back, so we focus on learning the market, understanding the market and solving key pain points instead of giving out a bunch of
Consumer financing, in our personal view, is more consumptive finance
first business loan and do not have other sources of financing
A lot of financial institutions take a collateral underwriting approach and a lot of budding businesses would not be able to secure
They already have a bank loan, but it is insufficient for them, so they come to us because they are limited by the size of their collateral
previously relied mostly on friends and family loans, access to more means of financing
The company points to a recent study by Ernst Young, UOB and Dun Bradstreet that says 65.2% of SMEs in Southeast Asia do not have easy
access to traditional business financing, even though most are open to other options, including peer-to-peer lending platforms.The company
says it was the first online peer-to-peer lending platform in Malaysia and that based on third-party data, it is now the leading SME lending
It also holds sizable market share in Indonesia.Though its platform uses algorithms for initial application screening, a significant portion
says the company is currently hiring in earnest and willing to pay relocation costs for promising talent)
Almost all applicants talk directly to someone from the company
Micro-loans, which range in size from $500 USD to $40,000 USD, usually take about two business hours to approve and disburse, while
money on the table, because our default rate is lower than certain banks in the markets we are serving, but given that we are still at a
relatively nascent stage in the lending market and have no control over financial crises, it is more important to stay prudent than to grow
country, Teo says it is still a fragmented market, so financial service companies need to localize carefully
When Funding Societies enters a new market, it can probably port about 50% of its tech and business model from its previous market, but the
