Incomlend is focused on solutions for the global trade financing gap
Singapore-based alternative trade financing startup Incomlend has secured US$20 million in its Series A round of financing, the company announced in a statement.
The round was led by Sequoia Capital India, with participation from French transportation and shipping company CMA CGM Group, the company said.
The company added that the funding will be used to drive Incomlend’s expansion efforts in Europe, Southeast Asia, and North Asia, and enhance the platform’s tech capabilities in building ‘state-of-the-art digital invoice finance underwriting and processing’.
“Our partnership with CMA CGM and Sequoia India is a major milestone for Incomlend’s growth and drive toward creating a stronger, safer and more efficient trade finance environment globally,” CEO and Co-founder of Incomlend, Morgan Terigi said in the statement.
Incomlend, which is looking to grow its funded trade receivables on the platform, also announced the fresh appointment of Marc Mathenz as its Deputy CEO. Mathenz was named Singapore Fintech Executive of the Year in 2018 by Singapore Business Review.
Founded in 2016, Incomlend is an invoice trading platform facilitating short-term credit for global trade.
Suppliers get paid for their exports earlier by selling the trade invoice to investors at a discount, while importers can receive a short extension on the due date of payment on invoices through Incomlend’s platform.
Apart from providing liquidity within the global supply chain, Incomlend also offers credit insurance against debtors’ credit risk to investors.
Institutional investors can trade invoices directly on Incomlend’s digital platform, while individual investors can invest in invoices through the company’s Luxembourg-based Invoice Finance Reserved Alternative Investment fund.
“Incomlend’s mission is to increase financial inclusion on non-recourse basis for companies of all sizes across the globe while offering investors real alternatives non-correlated to financial markets to existing asset classes,” Terigi noted in the statement.
Incomlend has processed over $330 million in trade finance across invoice finance deals in 50 countries to date, the statement noted.
The company aims to provide solutions for the cross-border trade credit crunch, mainly affecting mid-cap companies and small and medium enterprises (SMEs).
The company was in talks with World Bank-affiliate International Finance Corporation for a $5 million equity investment from towards the end of 2019. It had previously raised seed funding of an undisclosed amount from Singapore-based GTR Ventures in 2018.
“The massive trade finance gap, combined with declining global interest rates and the high credit quality of Incomlend’s customers, has helped them create a compelling business that helps solve one of the most important challenges faced by global SMEs,” Managing Director, Sequoia Capital (India) Singapore, Abheek Anand noted in the statement.
While 80% of global trade is financed by some form of credit, a third of SMEs in emerging countries face challenges in acquiring such credit, according to a report by the World Trade Organization.
Moreover, the report estimates that over half of global trade finance requests by SMEs are rejected, and Asia alone faces unmet trade finance needs to the tune of $700 billion. SMEs account for 96% of all businesses in Asia.
Globally, the trade finance gap for formal SMEs and micro-enterprises stands at $5.2 trillion, most of it concentrated in the East Asia and Pacific region.
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