To help expand financial inclusion in the Philippines, the International Finance Corporation (IFC), a member of the World Bank Group, is investing $7 million in the country’s fintech firm Salmon Group Ltd. (Salmon).

IFC joins this $25 million Series A extension round (Series A-1) as a lead investor alongside Northstar Group, a Singapore-headquartered private equity fund, and other local and international investors, IFC said in a statement on last Friday.

According to the statement, the capital will enable Salmon to develop new credit products and a lifestyle banking offering, which Salmon plans to launch in the second half of 2024.

IFC will also work with Salmon to further strengthen its role as a responsible lender.

“We are excited to welcome IFC and Northstar as our partners. IFC is one of the largest venture capital investors in emerging markets, and we share IFC’s commitment to leveraging disruptive technology to boost access to banking among the underserved,” said Raffy Montemayor, a Co-founder of Salmon.

Salmon is an innovative consumer fintech that focuses on providing short-term credit to consumers underserved by traditional banks.

The firm operates and owns a licensed bank (Rural Bank of Sta. Rosa Laguna Inc.) in the Philippines.

Founded in July 2022, Salmon uses artificial intelligence (AI)-enabled technology and a proprietary credit engine to offer market-disruptive consumer loans, such as Salmon Credit, Salmon Installment and Salmon Cash Loans.

In December 2023, the firm received the approval of the central bank of the Philippines, the Bangko Sentral ng Pilipinas (BSP), to become a licensed bank, which will allow it to expand the range of financial services to include deposit accounts, debit and credit cards, and other transactional products.

“This strategic investment reflects our confidence in Salmon’s vision of providing modern, affordable, and easy-to-access banking services to every Filipino,

“By pioneering investment in AI-enabled products in the country that will disrupt the market and traditional lenders, we hope to fill important gaps in the banking industry,” said Jean-Marc Arbogast, Country Manager for the Philippines at IFC.

According to the statement, the majority of Philippines’ adult population remains underserved by existing banks, especially in access to modern technology-centric credit products.

Cited the Bangko Sentral ng Pilipinas (BSP), it said only 25 percent have access to formal credit.

IFC is the largest global development institution focused on the private sector in emerging markets.

The firm works in more than 100 countries, using its capital, expertise, and influence to create markets and opportunities in developing countries.

In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises.

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