Brazil’s Creditas Gets $19 Million Amid Boom in Local Fintech Financing

Thursday, February 23, 2017

SAO PAULO (Reuters) – Creditas Soluções Financeiras Ltda, a Brazilian financial technology firm focused on secured consumer loans, has obtained $19 million from investors in a financing round that will allow it to provide borrowers with funds for one-fourth of what they pay to domestic lenders.

São Paulo-based Creditas said in a statement on Tuesday the so-called Series B round drew investors including the World Bank’s International Finance Corp, Naspers Ltd’s fintech arm and Brazilian venture capital firm Redpoint eventures. Redpoint had already taken part in a $7.5 million round for Creditas in June.

Creditas uses innovative credit scoring systems and borrowers’ assets to offer loans charging one-fourth to one-half of what banks and rival domestic fintechs do. Borrowers in Latin America’s biggest country pay an average 190 percent a year for unsecured, riskier overdraft, credit card and consumer loans, the highest among the world’s 20 major economies.

Creditas’s hybrid financing model allows it to originate loans using the borrower’s home or automobile as collateral. It funds loans using capital from investors or through partnerships with other, traditional financial institutions.

Source: US News (link opens in a new window)

financial inclusion, fintech, venture capital