Kreditech eyes expansion after securing EUR 20 million in equity financing

Kreditech is ready to scale globally in the near-prime customer
segment – declares David Chan, Kreditech CEO. The Germany-based online direct lender and Point-of-Sale (POS) financing provider estimates its global target market at ca. EUR 300 bn in consumer
credit issuance. It aims to reach EUR 1 bn in revenue by 2025, which will be driven by growth in existing markets where Kreditech is present, as well as expansion into new geographies. Kreditech currently operates in India, Poland, Russia and Spain, and serves over one million customers. The company has raised EUR 20 million in its latest equity financing round.

Kreditech combines market-leading tech capabilities and data science, with sound insight into consumer
borrowing needs and extensive experience in POS and e-commerce partnerships. Since 2018, the
company has been focused on scaling its near-prime lending operations and driving toward profitability. With well-established and growing operations in Poland, Spain and Russia, Kreditech’s near-term focus will be on rapidly scaling its business in India. The company also has plans to further expand in other major consumer lending markets in the coming years.

The cornerstone of Kreditech’s operations is a unique, differentiated, end-to-end fully automated
underwriting process that combines alternative data sources with machine learning. This process enables
a seamless customer experience based on a dynamic application process, near-instant credit risk
assessment and smart, personalized offerings. These features mean that Kreditech is able to effectively attract and serve customers with a variety of different risk profiles, thus enabling financial inclusion, while positioning Kreditech at the forefront of development in artificial and decision intelligence.

As a tech-based lender, Kreditech has developed an agile-driven, low-cost platform architecture that facilitates rapid partner onboarding, as well as lean, flexible, rapid scalability into new
markets. As a result, Kreditech has been recognized for its ability to build strong partnerships with
e-commerce and e-payments organizations, and for its ability to expand its direct lending through the
Monedo brand globally.

“We are on track to realize our vision, which is to be one of the leading technology-enabled consumer-
lending companies; a fintech platform of choice for both individuals and POS and e-commerce
partners. With a new strategy in place, a solid capital base and our highly motivated and
experienced team, we are perfectly positioned to achieve our goals”, says David Chan, Kreditech CEO.

The funds obtained during the latest round of equity financing will be utilized to scale Kreditech’s
business in its existing markets. In outlining the company’s current situation and its future plans, David Chan explains: “We have a well-established presence in Poland, with strategic partnerships in a very dynamically growing e-commerce market. In Spain, we are in a very strong position as a recognized consumer lending brand, and we are growing rapidly in the near-prime market. In Russia, we are a leading online lender, locally self-funded, and targeting expansion into instalment loans”.

“I am really excited about our growth plans in India. We hold a first-of-its-kind digital NBFC (non-banking financial company) license in a large and fast-growing market. We have been successful in finding our niche and have established the right proof of concept. Now it’s time to scale up while a key target customer segment remains unaddressed by the competition”, says David Chan.

In October 2019, Kreditech will publish its financial statement for 2018. As David Chan underlines, the results will show the positive impact of the new company strategy on its trajectory and overall performance. “I am proud to say that we are on track to reach our target for profitability of the company. Our platform is designed to facilitate rapid, profitable growth”.

The recent round of equity financing was co-led by Runa Capital, a global technology venture capital
firm, and a German private investor, with participation from long-time existing shareholders, HPE
Growth and Amadeus Capital Partners. A number of FinTech angel investors were also involved.

Runa Capital’s extensive experience and knowledge of the technology industry and of scaling such businesses is an ideal fit for Kreditech’s profile. “We are excited to be partnering with Kreditech as it continues on its path to becoming a global leader in digital near-prime lending. We believe that access to credit will continue to be improved through innovation and we see Kreditech as the emerging leader in this space, especially considering its presence in multiple fast-growing markets around the world,” said Andre Bliznyuk, General Partner at Runa Capital.

Tim van Delden, co-founder of HPE Growth, commented: “We are keen to support Kreditech. We have great trust in the new management team that Kreditech put in place in 2018. Kreditech’s track record over the last eighteen months, together with its business focus, strategy refinement and path to profitability has been truly impressive. For these reasons, HPE is convinced that Kreditech has the right management team to scale the business into the near-prime market. Kreditech’s core pillars of success remain the same – it is a technology and data-driven company that is able to use machine learning scoring models to make credit decisions in real time and with greater accuracy.”

Kreditech is an international company that has its headquarters in Hamburg, Germany. The company currently employs more than 300 people across seven countries and is developing regional centers of excellence and tech centers in Poland, Romania and Thailand. Kreditech lends to customers in India, Poland, Russia and Spain.