Fintech company bets on robust loans to hit income goal

MANILA, Philippines — International Finance Corp. (IFC)-backed Salmon Group Ltd. is hoping to achieve an annual net income of $200 million (P10 billion) in the next three to five years driven by more robust lending.

That profit target is based on Salmon’s ambition to fatten its loan portfolio to $2 billion (P100 billion) during that period, from around $6.8 million (P400 million) as of May 2024, with the help of new credit products such as an upcoming mobile app and debit card offering.

Last year, Salmon netted P1.7 million.

“It really depends on the timing at which we’re able to launch the bank app as well as, as a result, how we grow our deposits,” Raffy Montemayor, company co-founder, told reporters.

Funding from IFC

Salmon disclosed the projections nearly two months after it announced that it had secured $7 million in funding from IFC, the World Bank arm that is focused on the private sector, as part of a larger $25-million fundraising activity that attracted other local and foreign investors like Singapore-based private equity fund Northstar Group.

READ: Philippine fintech company Salmon gets $7-M IFC investment

Salmon, which provides short-term loans to consumers underserved by traditional banks, will use the fresh capital to develop offerings to be launched in the second half of 2024.

Salmon operates and owns Rural Bank of Sta. Rosa Laguna Inc. In December 2023, it received its banking license from the Bangko Sentral ng Pilipinas (BSP), allowing it to expand its range of financial services.

Founded in July 2022, the company uses artificial intelligence-enabled technology to enhance its credit scoring capabilities and a proprietary credit engine to offer consumer loans.