Kredivo, the leading digital credit platform for retail borrowers across Indonesia, and Victory Park Capital Advisors, LLC (“VPC”), a leading private credit specialist headquartered in Chicago, announced today the closing of a committed debt facility of up to US$100 million to fund consumer loans for Kredivo’s borrowers in Indonesia. The deal marks major milestones for both firms: for Kredivo, it is the largest deal in its history with a credit provider and also represents one of the largest ever credit lines secured by any digital credit platform in the region; for VPC, this represents their first transaction in Southeast Asia and Indonesia overall.
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The transaction, which closed in the previous quarter, will further propel the tremendous momentum that Kredivo has enjoyed to date, with strong growth and risk metrics, even in this year’s challenging macro environment. Kredivo will use the funds to grow and further diversify the funding of its loan book, all of which is 3rd party generated.
Commenting on the closure, Umang Rustagi, co-founder of Kredivo, said, “The large capital pool made available via this facility will enable the business to scale even further and get us closer to our goal of serving up to 10m customers in Indonesia over the next few years. We believe that the size and complexity of this facility represents major breakthroughs for Indonesia’s tech and fintech ecosystem. The entire Kredivo team is extremely pleased to have sealed a partnership with VPC, a renowned and sophisticated credit provider active in our space globally.”
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Gordon Watson, partner at VPC, said, “We look forward to our partnership with Kredivo. The company presents a unique combination of growth, scale, risk management and financial inclusion in one of the most exciting emerging markets in the world. We are very pleased to anchor our first investment in this region with a business of this caliber and one that is deeply passionate about enabling low-cost access to credit to the mass market.”
The transaction represents a major milestone for the digital credit ecosystem in Indonesia (and Southeast Asia). With less than 3% of its population in possession of a credit card, and banks historically cautious about providing unsecured credit to the mass market, digital credit providers such as Kredivo have been making efforts to fill the gap. While the unsecured credit industry is primarily fueled by peer-to-peer lending models, the transaction between Kredivo, which operates as a multi-finance company, and VPC represents a significant departure from the norm, and a sign of the growing institutional credibility of emerging fintech players.
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