Philippine lending platform First Circle raises $26m
First Circle, a lending platform for SMEs in the Philippines, has raised $26 million in its Series A funding round, led by Venturra Capital and with participation by Insignia Ventures Partners, Silverhorn Investment Advisors, and tryb Group.
The capital will allow the platform to expand nationwide, aiming to increase its capital base to over $100 million next year to keep up with the demand in the region.
“Our focus on supply chain and trade financing has enabled us to reduce our average approval time to five hours regardless of prior credit history—and what we’ve found is, every time we help a small business earn their first-ever credit facility, their whole community benefits,” says Patrick Lynch, CEO and co-founder of First Circle.
The firm says it would “keep an eye towards hitting similar markets in Southeast Asia in the midterm”.
“Cashflow management is the number one reason why small businesses go out of business. First Circle provides an incredibly easy and affordable service for small businesses to thrive and solve cash flow challenges,” says Yinglan Tan, founding managing partner of Insignia Ventures Partners.
This comes as the Philippine government rolls out a slew of initiatives to champion the SME sector, including fast-tracking a law that allows assets other than land as collateral and pushing for greater adoption of digital channels.
Beginning next year, President Rodrigo Duterte has also pledged more government assistance to budding entrepreneurs.
By some estimates, the credit gap in the Philippines remains at $50 billion. Latest World Bank Findex data also ranks it as one of the countries with the highest ratio of business owners borrowing capital from relatives and friends.
First Circle is supported by the Philippine Department of Trade and Industry and the Bangko Sentral ng Pilipinas with Secretary of Trade Ramon Lopez and Deputy Governor Fonacier joining today’s funding announcement at First Circle’s office in Manila, Philippines.
