Visa backs Branch for mobile-based lending in developing markets

Branch International, a San Francisco-based startup that uses mobile phones to offer loans to people without bank accounts in developing countries, has closed a $170 million Series C funding round led by Foundation Capital and Visa, which is also backing the firm through a strategic partnership.

Be the first to comment

Visa backs Branch for mobile-based lending in developing markets

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

Branch, which claims to be the most downloaded finance app in Africa, was launched in 2015 by Matthew Flannery, who previously founded microfinance outfit Kiva.

The firm collects data - including SMS and call logs, GPS information and contact lists - from users' Android handsets. Machine learning algorithms then decide creditworthiness and loan terms.

First launched in Kenya, Branch now also operates in Tanzania, Nigeria, Mexico and India. It has processed 13 million loans, worth $350 million, for three million customers.

The startup plans to expand its reach in Africa, Latin America and India through the new Visa partnership that will see customers offered virtual prepaid card numbers that let them receive their credit at any ATM.

Says Flannery: "We started Branch in Kenya, where M-Pesa gives anyone with a phone - including the unbanked - access to digital credit. Unfortunately, mobile money isn’t available in most countries. With the help of Visa, now we can send cash to any ATM and reach the underserved around the planet."

Bill Sheedy, EVP, strategy, Visa, adds: "Our partnership with Branch provides Visa a key distribution mechanism to reach people that were previously out of reach and help shape the future of microfinance."

The funding round was also joined by Andreessen Horowitz, Trinity Ventures, Formation 8, the IFC, CreditEase, Victory Park, Greenspring, Foxhaven and B Capital.

Sponsored [On-Demand Webinar] SEPA Inst Mandate: Impacts on Day 1, Day 90 – and beyond?

Comments: (0)

[Webinar] Microservice Architecture: The answer to modern payments processingFinextra Promoted[Webinar] Microservice Architecture: The answer to modern payments processing