According to Reuters, Pakistan’s B2B2C fintech AdalFi has raised $7.5 million to address the country’s lending challenges.
The funding round was led by UAE-based COTU Ventures and Chimera Ventures, Pakistan-based Fatima Gobi Ventures and Zayn Capital, and angel investors including executives from US-based financial technology and services provider Plaid.
“Across the board, only 5% of deposit customers in Pakistani banks are also borrowers,” AdalFi co-founder and CEO Salman Akhtar told Reuters. So, we enable banks to tap this huge, latent customer base”.
He stated that 14 financial institutions in Pakistan have joined AdalFi, including United Bank Limited (UBL), Habib Bank Limited (HBL), and Meezan Bank, among other local banks and microfinance institutions. “Banks typically take two weeks to process a loan request without our platform. Banks have joined AdalFi because we provide rigorous credit scoring to ensure portfolio quality,” he added.
“We share the downside risk of non-performing loans,” he added. Loan losses are pro-rataly accounted for in AdalFi fees”.
AdalFi’s proprietary technology scores existing financial transactional data from banks. Following that, its platform enables customised digital marketing to qualified prospects, followed by real-time loans.
With the new funds, the startup hopes to reduce loan disbursement lead times and shift loan seekers away from the informal markets and onto its platform.