PayU backs Kreditech, eyes emerging markets
Online payment service provider, PayU, is stumping up Euro110 million for a significant minority stake in Kreditech. It is the largest ever equity investment in a German FinTech and builds on a 12-month pilot programme in Poland, where consumers were given access to credit in a real-time online process.
The deal combines PayU’s international footprint with Kreditech’s technology to bring credit services to underbanked markets. Kreditech will expand its Lending as a Service (LaaS) offering and deliver its AI and machine-learning credit underwriting and loan management technology to PayU’s 300,000-strong network of merchants.
“We are thrilled to offer online Point of Sale finance in markets where the development of consumer credit has been severely constrained by the lack of reliable credit risk assessment. Our credit scoring and underwriting technology allows PayU and its merchant partners to offer a competitive, convenient credit product to their retail customers”, says Alexander Graubner-Müller, CEO at Kreditech. “Teaming up with PayU provides underbanked customers new possibilities and supports our mission of providing financial freedom through technology. At the same time, we enable retailers to reach a new customer group and significantly increase sales volume.”
Laurent le Moal, CEO at PayU, says: “We are excited to build a leading innovative online consumer lending player in high growth markets. With our substantial investment we deepen our relationship with the industry-leading management team at Kreditech, and help to bring pioneering machine learning and AI technology to the many high growth markets around the world that need better access to financial services. At PayU we believe in the enormous potential of technology to unlock credit and financial services for underserved populations. In the past 12 months, we have become the leading corporate venture capital investor in FinTech, investing more than Euro 245 million around the world. This latest investment in Kreditech fits perfectly with this vision.”