Colombian fintech Finkargo announced it raised $75 million in structured credit from Community Investment Management (CIM) — an impact investment fund that focuses its resources on companies that promote financial inclusion and that has previously invested in LatAm fintechs as Stori (Mexico) and Xepelin (Chile).
Finkargo is focused on financing foreign trade operations for small and medium-sized companies in Latin America,
With this investment, the fintech plans to accelerate the growth of more than 600 companies in the international trade sector in Colombia over the next year, according to the startup.
Finkargo’s new fundraising was made possible after the company received a $7.5 million seed investment seven months ago and financed close to $50 million in international purchases by small and medium-sized companies last year.
“The trade finance market historically ignores small and medium-sized businesses, as banks and traditional players focus on large companies. Finkargo uses innovative technology-based solutions to change this and allow Latin America’s 27 million small and mid-sized companies to participate in foreign trade,” said Santiago Molina, CEO, and co-founder of Finkargo.
“We are excited to support the placement of responsible capital with Finkargo, transforming the financial inclusion and growth of small enterprises in the region. Finkargo’s mission is aligned with our vision of supporting financial technology solutions that generate real and scalable impact in underserved sectors,” said Alejandro Arenas, Investment Principal of Community Investment Management (CIM).
Finkargo was founded in 2021 by Santiago Molina, Tomás Shuk, and Andrés Ferrer to solve a specific problem: enabling regional companies of various sizes and logistical capabilities to trade through simple, less bureaucratic financing.
Simple credit application process
The possibility of a simple process for credit application and Finkargo’s integrated shipment tracking system are the key to the success of the fintech, which is consolidating itself in the continent as a relevant player in the sector with its innovative proposal.
According to the company, these benefits are reflected in the growth of the small and medium-sized companies that Finkargo serves in Colombia, which have increased the value of their operations by 62% and have diversified their supply chain by increasing the number of suppliers they work with by 27%.
The fintechs states that the extensive knowledge and experience in small and medium-sized companies financing, foreign trade, and international logistics allows their team to design specialized financial solutions, which incorporate a risk analysis and alternative guarantees adjusted to the reality of companies of global markets.
Empowering LatAm companies
“If the small and medium-sized businesses we help finance can accelerate their growth and profitability, our objective is achieved. This way, we can continue to set investment goals that are not only larger but also more inclusive for those companies that are still unable to access the international market due to lack of capital,” added Finkargo’s CEO.
In a statement to the market, the CRO of Finkargo Tomas Shuk said: “We are empowering a whole generation of entrepreneurs looking to grow in the foreign market. Latin America has never seen a platform designed for financing the purchase of foreign trade goods that provides coverage, flexibility, and speed by allowing payment to international suppliers in less than 24 hours.”
Since launching its fully digital import financing product in Colombia in June 2021, Finkargo has financed more than 700 international operations with a value of more than $50 million.
So far in 2022, Finkargo has tripled its team of people in Colombia, Mexico, and the United States and expects to double that number again by the end of the year while aiming to expand its regional operations.
Jorge C. Carrasco is a Contributing Reporter at Fintech Nexus. He reports on fintech, economy, banking, startups, and technology, covering the most impactful stories from a Latin American perspective.
He has contributed to several international publications, such as Foreign Policy, The Spectator Australia, Estadão, Época, Washington Examiner, and Quillette. Originally from Havana, Cuba, he is now based in Brazil.