ID Finance, the fintech innovator of emerging markets, has secured $50m in debt funding to support the company’s rapid growth having more than trebled revenue to $68m in 2016. The company will use the financing – which includes $15m from TransKapitalBank – to fund its expansion across Latin America after launching its MoneyMan online lending product in Brazil last year.
ID Finance is a data science, credit scoring and digital finance business. The company was founded in 2012 by CEO Boris Batine and COO Alexander Dunaev, who previously worked in finance and recognised the potential for fintech in emerging markets. The balance sheet lender, which reached profitability in 2015, is now the number one online lender in Russia and the CIS region. Having also launched in Poland, Spain and most recently Brazil, the company is now issuing over 50,000 loans every month.
“The opportunity for fintech in emerging markets is so large it’s difficult to measure – we’re talking about a massive structural consumer demand for credit that is not being met by incumbents,” comments Boris Batine, CEO at ID Finance. “These are often huge markets with highly uncompetitive financial services and limited availability of credit. Thanks to the growth of the internet and mobile, we can make it much easier for people to apply for loans and by using alternative sources of data we can extend credit to a much larger portion of the population.”
The core of the business is its advanced IT and risk management system, which collects and analyses thousands of data points in real time. With teams of data scientists and risk analysts, many of which come from the financial services industry, it is continually evolving its technology and has one of the best performing risk management systems in the industry. As a result the company is able to reach profitability within a year of launching into a new market.
“Having launched in Russia we’ve had to focus on efficiency and profitability from the outset. We built our entire technology stack in-house which gives us complete control over our IT and allows us to move very quickly,” continues Boris Batine, CEO at ID Finance. “We’re now enjoying strong and consistent growth thanks to a diversified loan portfolio that covers Russia, Kazakhstan, Georgia, Spain, Poland and Brazil.”
According to McKinsey, emerging markets could boost their economies by $3.7tn over the next decade by embracing the full potential of digital finance. Despite experiencing massive geopolitical crises and wild currency swings in a number of markets, ID Finance has grown 15% monthonmonth since January 2015. The company moved its headquarters to Barcelona last year and now has over 380 staff spread across offices in Spain, Georgia, Russia, Kazakhstan, Belarus, Poland and Brazil.