Investor interest in the sector will give impetus to new modes of lending, such as buy now, pay later (BNPL), market sources told iupana.
“The beauty of this new capital is that it drives innovation, especially in financial services, and allows agile models like BNPL to appear,” said Nicolás de Camino, CEO of Chilean fintech Xepelin, which raised US$80 million on January 18th. “We’ve seen BNPL develop a lot in the B2C segment and it’s starting to appear in the B2B segment,” he told iupana.
Commenting on the credit sector’s rapid growth, Gastón Vega, the CEO of Avanzo, a Colombian fintech that raised a US$1.3 million seed round, said:“ We’re growing like mushrooms on different fronts; if it was just one, it wouldn’t be so funny because it would be easy for banks to imitate,” Vega said.
Underlining the dynamism in the credit fintech sector, Brazil’s Creditas said this week it is preparing for an initial public offering (IPO) in the U.S. and expects to achieve a valuation of US$10 billion. The IPO is seen taking place at the end of the second quarter. The firm will surely be expecting a similar reception to the one Nubank received in December.
Other credit fintechs raising capital included Chile’s Xepelin, which provides financing to SMEs via factoring and other mechanisms. It received US$80 million from Community Investment Management (CIM) to bolster its expansion in Mexico.
Meanwhile, Fairplay, a Mexican fintech that lends to SMEs, raised US$35 million in a Series A split between equity and debt, with Dila Capital, Kayyak Ventures and Architect Capital putting up the cash.
And Agrolend, a Brazilian fintech that finances agricultural producers, closed a series A round for R$80 million (US$14.5 million) led by Grupo Valor Capital.