Tala, the US based fintech startup that offers loans to consumers in emerging markets, announced that they have received an investment from payments company Paypal.
Tala and Paypal did not immediately disclose the size of the investment, but they did announce that this would be used to expand their global reach.
“The two companies share a commitment to building financial health, enabling all people to gain access to the digital economy,” the companies said in a release. “PayPal’s investment will help Tala bring visibility and access to underserved populations in emerging markets across the globe.” This new investment builds on Tala’s Series C financing that was announced in April.
You can understand why they would need more money for expansion. Apparently more than two thirds of the adult population has no formal credit bureau record which makes it hard for traditional financial services to reach these consumers.
Currently, Tala operates in a few countries around the globe: Kenya, Tanzania, the Philippines and Mexico. They have also launched a pilot in India which is one of the top developing countries in the world. This new investment would allow them to conquer new markets, of which the have not disclosed, but you can bet they are targeting emerging markets.
According to the company, they have been able to dish out more than $500 million in credit to millions of people in their current markets, which is impressive by any measure.
In Kenya, Tala was used to be called Mkopo Rahisi before rebranding in 2016 and it is one of the top lending apps in the country. It is not the only lending app that is raising money for expansion, as another Silicon Valley fintech startup, Branch recently raised $70 million in a Series B funding to expand to other countries that includes India.