ID Finance, the emerging markets fintech company, has joined forces with former Elbrus Capital fund manager Yuri Popov and asset management company Da Vinci Capital to launch FinTech Credit Fund, a $200m debt finance fund aimed at financial technology companies with a focus on alternative lending.
FinTech Credit Fund will offer debt finance to companies looking to scale and will cover loans to the companies themselves, as well as financing of their loan portfolios. The duration of the agreement will range from six months to three years.
“The vast majority of money going into fintech is chasing a small number of well-known startups. There are many more high quality fintech companies all over Europe, some of which are performing extremely well, that are seeking capital to scale,” comments Boris Batine, Co-Founder and CEO at ID Finance. “We see a huge opportunity to support these companies while providing a superior risk adjusted return to investors.”
The Fund will initially focus on projects within the CIS and European markets. Funding will be provided to companies involved in consumer and SME lending, and both balance sheet and marketplace (p2p) lenders will be eligible. Projects offering analytical solutions for credit scoring based on Big Data, AI and machine learning, as well as SaaS and PaaS solutions and payment services are of particular interest to the Fund and align with the investors’ areas of expertise.
Investment decisions will be made following assessment of a number of criteria including: a company’s creditworthiness, the strength of their business model and technology, the quality of their loan portfolios, and risk and revenue potential.
“ID Finance and Da Vinci Capital will provide a solid investment process and infrastructure for the Fund as well as access to our broad network of institutional and private investors. Our expertise in fintech and alternative lending at an international level will also help to reduce credit risks,’” added Oleg Zhelezko, Managing Partner, Da Vinci Capital.
ID Finance is one of the fastest growing and fastest moving online lenders globally. The balance sheet lender was founded in Russia in 2012 and has rapidly expanded into Kazakhstan, Georgia, Poland, Spain and Brazil.
“The alternative lending market is worth a potential $2 trillion and we see a huge opportunity to back the billion-dollar companies of tomorrow focused on digital lending,” continues Alexander Dunaev, Co-Founder, ID Finance.