Mizuho Bank Ltd, a subsidiary of Mizuho Financial Group, Inc., oversaw an oversubscribed series D funding round, raising US$ 270 million (IDR 4 trillion) for Kredivo Holdings, Kredivo’s holding company, and Krom Bank which was founded in 2016.
During the D series equity funding round, Mizuho Bank Ltd, a Japanese global bank and a subsidiary of Mizuho Financial Group, Inc. (Mizuho), took the lead by participating with US$ 125 million.
In addition to Mizuho Bank Ltd’s participation, several top-tier investors from previous rounds also participated, including Openscape Ventures, GMO Venture Partner, Naver Financial Corporation, Jungle Ventures, and Square Peg Capital.
This funding strengthens Kredivo’s position in the digital financial services industry with a strong ecosystem expansion, said Akshay Garg, CEO of Kredivo Holdings, in an official statement on Thursday, March 23, 2023.
“Despite the challenging market conditions, investors continue to recognize our scale, business strength, and innovation potential,” Garg added.
The expansion encompasses various services such as online and offline Buy Now, Pay Later (BNPL), cash loans, physical and virtual cards, and supports the launch of Krom, a neobank.
According to Daisuke Horiuchi, Group Executive Officer Deputy Head of Retail & Business Banking Company from Mizuho, Kredivo has an extraordinary track record in Southeast Asia because it has in-depth data partners in increasing financial inclusion in Indonesia and Southeast Asia.
Daisuke also considered Kredivo had successfully build an efficient business models.
“Digitizing financial services is a long journey, and we are excited to support Kredivo’s mission to build the best quality digital financial services platform in Southeast Asia,” concluded Horiuchi.
Non-performing loans
One of the risks in providing financing services would be the non-performing loan (NPL) ratio. By the end of 2022, Kredivo has set a target of a non-performing loan (NPL) ratio below 5%.
Kredivo’s Vice President of Marketing & Communications Indina Andamari, such ratio can still be considered as normal.
“This issue has only been around for a few months (bad credits). Indeed, consumers are somehow affected. However, our NPL is still maintained,” said Indina Andamari as quoted from fortuneidn.com, on November 30, 2022.
PT Pefindo Credit Score Bureau recorded Kredivo’s Paylater NPL ratio in July 2022 at a level of 6.49%, a number lower compared to the previous 7.02% recorded in June 2022.
According to data from the Financial Services Authority (OJK), Paylater’s NPL has a higher level than NPl ratio recorded in the general banking sector, which reaches 2.79%.
