Two important funds have invested in startup that focuses on helping
Brazilian borrowers access affordable credit through secured loans
São Paulo, Brazil— August 4, 2015 –BankFacil, a digital platform innovator that helps Brazilians receive more affordable, secured loans without leaving the house, has received an investment of BRL 10 million (approximately USD 3 million). The new Series A funding came from Redpoint eventures, a leading Brazilian VC firm that invests in early-stage technology companies, and from Accion’s Frontier Investments Group.
Founded in early 2012, the financial technology pioneer facilitates secured, online loans with the goal of reducing the interest paid by families and the time spent on bureaucracy and paperwork. According tothe latest reportfrom Brazil’s Central Bank, Brazilian consumers pay average annual interest rates of approximately 58 percent for non-secured bank loans. The averaged annual interest rates for the three most expensive categories – credit card financing, personal loans and overdraft – are 178.8 percent, with a total combined outstanding debt value of R$178.7 billion.
The ability to refinance expensive, unsecured credit into structured, secured loans increases access to affordable credit for Brazilian households. By using assets such as real estate or vehicles as a collateral for loans, borrowers can reduce costs and extend the payback period. Using BankFacil’s digital platform, borrowers have immediate access to all the necessary information they need and a team of specialized consultants to help them in the process.
According to the company’s CEO and founder, Sergio Furio, BankFacil’s ultimate vision is to democratize credit. “Our goal is to reduce financial pressure for our clients, who in some cases are able to save more than 70 percent on their monthly payments. By using digital channels, we eliminate the high costs of physical branches and let clients directly manage the process with less bureaucracy. We use algorithms to better understand our clients’ profiles and present them with enhanced solutions. In addition, clients have the option to work with a specialized consultant who helps them obtain the loan,” he says. A Spaniard, Furio worked for Boston Consulting Group in New York City before moving to Brazil to found the company.
One of the most sought-after services on the website is home equity loans, which is very common in the United States and starting to gain ground in Brazil. With BankFacil, annual interest rates for home equity loans start at 20 percent and auto refinancing loans start at 30 percent. The average loan size is R$180,000 to refinance homes and R$20,000 to refinance automobiles. BankFacil has originated more than R$80 million in loans to date.
A Redpoint eventures partner, Anderson Thees says that BankFacil stands out for its ability to work with the country’s main financial institutions. “BankFacil is an innovator in its advanced use of technology when seeking solutions for its partners. Because of this, the company is increasingly forming key partnerships, which translate into growing returns for everyone. The automation supports banks and lending partners to increase productivity by reducing wasted time and resources, while helping consumers significantly reduce the cost of loans and credit.”
Thees’ vision is shared by Jonathan Whittle, managing director of Accion’s Frontier Investments. For him, the startup’s key difference is allowing more people to have access to financing and loans. “Brazil has a large market that had not been using banking services because of difficulties in access. This is a gap that BankFacil has filled very efficiently.”
About Redpoint eventures
Redpoint eventures is a venture capital firm based in São Paulo. Our mission is to support Brazilian digital market entrepreneurs on their journey to create fast-growing companies. Together with its partners, prominent U.S.-based firms Redpoint Ventures and e.ventures, Redpoint eventures brings funding, Silicon Valley access and global best practices to promising startups. In addition to serving the companies in its portfolio, the fund’s team is helping to develop the growing entrepreneurial ecosystem in Brazil. For more information, seewww.rpev.com.br.
Accion is a global nonprofit dedicated to building a financially inclusive world with economic opportunity for all, by giving people the financial tools they need to improve their lives. We are building the next generation of top-tier microfinance institutions, and over the last 50 years have helped create 64 such institutions in 32 countries on four continents that today reach millions of clients. Our impact investing initiatives are pushing beyond microfinance to catalyze more than 20 innovative start-ups dedicated to improving the efficiency, reach and scope of financial services for the poor. And our Center for Financial Inclusion is helping to build a stronger industry with high standards. Currently, our work spans nearly two dozen countries, including the U.S., where we are the nation’s largest nonprofit microfinance network. For further information, visitwww.accion.org.
About Frontier Investments Group
Frontier is a venture equity initiative that invests in companies with disruptive models that enhance the efficiency, reach and scope of financial products and services for those underserved in emerging markets. Frontier is part of Accion, a pioneer and global leader in financial inclusion with five decades of experience in emerging markets – including feet-on-the-ground and institutional relationships on four continents and a deep bench of industry specialists. Additional information is available atwww.accion.org/frontier.