Kredivo, a digital credit card for the masses, banks $30m series B funding

Paying with Kredivo on mobile / Photo credit: FinAccel

Getting a credit card can be difficult if the bank thinks your personal finances aren’t looking shipshape. For the roughly 70 percent of Southeast Asians who are “unbanked,” it can be close to impossible – which isn’t ideal in a region where online shopping is exploding in popularity.

It’s a problem that FinAccel is seeking to solve with Kredivo, its “digital credit card” and point-of-sale system. The Jakarta-based startup has just raised US$30 million in a series B round led by Australia’s Square Peg Capital.

See: Square Peg Capital’s Paul Bassat on Southeast Asia investments

Kredivo allows users to “buy now, pay later” when shopping online. Users are credit-scored and approved, and are offered a variety of options for paying off the debt. These include interest-free 30-day repayments and other low-cost installment plans. Kredivo claims that it has credit-scored two million Indonesians.

It’s available as a payment method with around 200 merchants, including top regional ecommerce sites Bukalapak, Lazada, Shopee, and Tokopedia.

FinAccel’s core team / Photo credit: FinAccel

FinAccel CEO Akshay Garg said that the startup will use the funds to develop new products, make hires, and expand geographically “with the aim of becoming the preferred digital credit card for Southeast Asian millennials.”

Previous backers, including 500 Startups, Alpha JWC Ventures, GMO Venture, Jungle Ventures, and Openspace Ventures also joined the round. MDI Ventures and Atami Capital came on board as new investors.

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Mirroring the situation across Southeast Asia, credit card penetration is particularly low in Indonesia. According to payments firm Adyen, just about 15 percent of the archipelago’s population has been issued with a credit card. Only about a quarter of Indonesians even have a bank account.

See: Indonesia’s long road to cashless payments

By far the country’s preferred payment method is cash. That remains the case even for online shopping, where cash-on-delivery is the most common method of settling the bill next to bank transfers. But as ecommerce continues its steamroller advance, new solutions for settling payments for online shopping need to be found.