- Embedded finance platform Credable has raised $2.5 million to provide financial services to businesses in emerging markets.
- Ventures Platform led the round with participation from other VCs and angel investors.
- The startup wants to use the funding to expand into bigger markets — Nigeria and Pakistan.
Founded in 2021 by Nadeem Juma, Jad Abbas, and Michael Tarimo, Credable launched officially in May 2022 by offering a short-term lending product for Diamond Trust Bank in Kenya and a 30-day term loan product in cooperation with Vodacom M-Pesa in Tanzania.
The startup, which currently has a presence in three markets; Tanzania, Kenya, and Uganda, has over 1.2 million customers, including small businesses, and 200,000 of them have used its banking products.
Per TechCrunch, Credable has just raised $2.5 million seed in a round led by Ventures Platform with participation from Launch Africa, MAGIC Fund, ACASIA Ventures, AAIC Investment, and Adaverse/Emurgo Africa.
The startup is looking to expand beyond its three markets to bigger markets like Pakistan and Nigeria, where there's stable regulatory space and more profitable businesses.
The CEO, Nadeem Juma, told TechCrunch, "The problem we're trying to solve is that a huge population of underbanked customers need banking services to improve their livelihoods. They are in different channels that they use every day, like telco-led mobile money, e-commerce platforms, and gig economy apps."
"Rather than try to create a new channel to bank these customers, we aim to enable these channels through a B2B2C offering that provides the customers with the banking services they need in the channels they're already in."
Juma said Credable wants to be the Unit — one of the US leading banking-as-a-service platforms — of emerging markets.
However, the CFO, Abass, notes that there are more considerable challenges to building such a company in emerging markets than in the US. According to him, many banks and businesses in the US are already familiar with the model, which makes the building seamless.
But for emerging markets, he said, "we're not there yet because we have a large underbanked population to start with. And that's what we're doing, building that capability to get there, which today involves a lot of different things that Credable takes the lead on when launching new digital banking products."
Image source: TechCrunch