Southeast Asian peer-to-peer (P2P) lending platform Funding Societies, which is known in Indonesia as Modalku, today announced that it has raised a US$25 million Series B funding round.
The funding round is said to be the largest raised by a P2P lending platform in Southeast Asia.
Led by Softbank Ventures Korea, the funding round also includes existing investors Sequoia India, Golden Gate Ventures, and Alpha JWC Ventures.
Claimed to be oversubscribed, the funding round also included participation of Qualgro and LINE Ventures.
In addition to the venture capital round, Funding Societies has also raised credit lines from banks and financial institutions to further support SMEs on their platform.
The startup plans to use the funding primarily to develop products, enhance user experience on the platform, and ensure top-notch compliance and security.
“Our vision has always been to make a positive impact in Southeast Asia, especially in financial inclusion. Staying focussed, we’d continue to enable growth for SMEs and create wealth for lenders in Southeast Asia,” Funding Societies Co-Founder and CEO Kelvin Teo explained to e27.
The startup already has presence in three Southeast Asian markets: Singapore, Malaysia, and Indonesia.
“We only enter markets that we’re passionate in and that we can win, hence Southeast Asia is our natural choice. We’re exploring new markets. However, the truth is there is still a lot of work to be done in our current markets. Hence we have not yet decided whether to expand or not,” Teo said when asked about the possibilities to enter new markets or even new region.
Founded in 2015 by Kelvin Teo and Reynold Wijaya, the platform connects underserved SMEs with retails and institutional lenders. It includes features such as e-signing of contracts, auto investment algorithm for lenders, and a mobile app for borrowers and lenders.
The startup said that its platform has crossed the S$100 million (US$76 million) mark in crowdfunded SME loans in January 2018. The milestones marked a 300 per cent growth of its loan book since the same period in 2016, with a default rate of less than 1.5 per cent.
Prior to this funding round, Funding Societies raised US$7.5 million in Series A funding round led Sequoia Capital.
Image Credit: Funding Societies