Singapore’s peer-to-peer lending platform Validus said on Friday that it has raised SGD 30 million (USD 22.4 million) from UK alternative asset manager Fasanara Capital. The company will utilize the fresh investment to boost lending for underserved and unbanked small and medium-sized enterprises (SMEs) in Singapore, especially via Validus’ Enterprise Financing Scheme (EFS).
“The Enterprise Financing Scheme by Enterprise Singapore is a government-assisted financing and risk-sharing scheme that is among the Singapore government’s initiatives to help support the needs of local businesses, especially during the pandemic,” Validus co-founder and group CEO Nikhilesh Goel told KrASIA. “The scheme offers up to 90% risk-sharing when financing is given to SMEs by participating financial institutions, including Validus.”
Goel added that the platform is seeing strong demand for EFS loans, and he expects to empower more than 500 SMEs every year through this scheme. Validus is currently in talks with local partners in other markets to roll out similar arrangements.
With a key focus on investment solutions that impact the broader economy, Fasanara joined Validus as a lender in 2019 by investing SGD 20 million (USD 14.9 million), which has since funded more than 2,800 SME loans through Validus’ SME financing marketplace.
Founded in 2015, Validus provides loans up to SGD 500,000 for SMEs, including invoice financing, purchase order financing to buy inventory and complete customer orders, as well as short-term working capital loans to help entrepreneurs expand their business. The company also has a presence in Indonesia, Vietnam, and Thailand.
Goel said that, on average, Validus-supported SMEs experienced a 17% increase in their annual revenue and 12% employment growth since they joined the platform.
“SMEs on the Validus platform are able to obtain approval in less than 48 hours and access funds within a few days; this helps to bridge their cash flow gap for operational expenses and to fund growth opportunities such as on-time payment of levies, ability to fund and fulfill project requirements, minimized delays in project delivery, and ability to take on more projects,” he said.
Validus currently serves over 350 high-net-worth individuals and institutional lenders, and the company has disbursed over SGD 850 million loans for SMEs across Southeast Asia so far.