(L-R ) IFC Senior Investment Officer Aileen Zarate, IFC Country Manager for the Philippines Jean-Marc Arbogast, DTI Undersecretary Blesila Lantayona, First Circle CEO Patrick Lynch, First Circle Vice President Benedict Carandang. Photo from IFC
The International Finance Corp. (IFC), part of the World Bank Group, is pouring more funds to help develop the Philippines’ financial sector with new investments in local fintech firms First Circle and Salmon.
In a statement on Thursday, IFC said it invested $7 million in First Circle, which offers smart banking solutions to small and medium-sized enterprises (SMEs).
This IFC noted that lack of access to financial services continues to hold back smaller businesses, particularly in the Philippines where credit penetration stands at 2.2 percent of the country’s gross domestic product as of last year, trailing many regional neighbors.
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Since its inception in 2016, First Circle has funded over 3,000 unique customers, over two-thirds of which are SMEs accessing credit for the first time.
The IFC said its investment will “unlock” First Circle’s capacity to expand credit lines and deliver smarter banking solutions to the underserved SME market.
Meanwhile, Salmon provides short-term loans to consumers underserved by traditional banks. IFC took part in Salmon’s $30-million fundraising activity.
This marked the second funding injection of IFC to Salmon, which earlier this year received $7 million
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Salmon said Lunate of Abu Dhabi, another existing investor of the company, also took part in the new equity financing round.
”The funds will be directed toward continued scaling of Salmon’s profitable lending business and launching new products designed to meet the evolving needs of more than 50 million Filipino consumers underserved by the legacy banks,” Salmon said.
“A portion of the proceeds will also bolster the company’s marketing activities at thousands of retail locations across the Philippines, as well as expand its online offering,” it added.