Across Latin America, fintech lenders are accelerating profitability strategies amid growing pressure from markets to yield profits.
The Brazilian digital lender added $200 million in its ninth funding round and announced it was buying both a bank and a mortgage lender.
Creditas recently closed one of the largest rounds in Latin American history and has originated more than $100mn in loans since 2011; they company offers loans backed by collateral, charging 17 to 25 percent for their home equity loan and 23 to 50 percent for auto equity loans; this is unique as banks typically charge 120 percent APR on unsecured loans and 480 percent APR on revolving credit cards; having a lower cost, more secure loan has seen them keep defaults around 1 percent and grow the company workforce threefold in the past year alone. Source.
Creditas, a provider of online secured loans in Brazil, has closed a $19 million funding round which included investment from World Bank member, International Finance Corporation (IFC), Naspers Fintech, Redpoint Eventures, Kaszek Ventures, Quona Capital and QED Investors; the financing marks the first investment in fintech from IFC, a global leader in emerging market private sector investments; the firm plans to utilize the new capital for new distribution channels, technology innovation, platform growth and market positioning; additionally the firm also plans to reduce its minimum interest rate from 2.15% to 1.99% per month, which is compared to the average consumer lending rate in Brazil of 7.20%. Source
Creditas made a bold acquisition in the context of uncertainty, as valuations for many fintechs plunged amid rising rates and volatility.
Creditas, a provider of online secured loans in Brazil, has raised $16 million from the asset-backed securitization market and will use the proceeds to fund auto loan refinancings; the firm partnered with Empirica Investimentos Gestao de Recursos Ltda to launch the securitized investment portfolio, FIDC Empirica Creditas Auto; Creditas seeks to capitalize on an auto loan refinancing market opportunity that has seen increased risk from higher defaults with decreased lending from traditional banks; Brazil reports secured personal credit accounts for 1% of the country's outstanding loans; Creditas plans to offer auto refinancing at monthly rates of 1.99% to 3.65% for an annual rate of approximately 37% which compares to bank rates annually of 120%. Source
Creditas is an online secured loan provider in Brazil; the company has announced the release of its 2017 Brazil Lending Market Report which provides an overview of the country's trends in consumer lending; also reports on market metrics including interest rate spreads and outstanding debt by lending categories. Source