iCred raises $58 million to develop payroll loans solutions in Brazil

iCred, a fintech that facilitates payroll loans, has launched an origination campaign and accessed a new $58 million to provide payroll loans to the more than 36 million Brazilian Social Security (INSS) beneficiaries, which can help its users organize their accounts and pay off debts.

The startup will use these resources to expand its operations and enter the payroll loan market for the beneficiaries of the social security fund.

Payroll loans with fair rates

“With this new funding, iCred can facilitate a payroll loan for INSS beneficiaries who need credit at fair rates, starting at 1.49% per month, considering today’s yield curve. No doubt we will be very competitive,” says Tulio Matos, co-founder of iCred, in a statement.

“The relationship of trust that we build with our clients and the big financial players in the market makes us very happy. This shows that we are on the right track and gives us more security to offer a quality service, always seeking to improve it to make everything simpler for the customer,” adds the executive.

Tulio Matos, Co-founder of ICred
Tulio Matos, Co-founder of ICred.

In its beginnings, iCred only offered loans to workers with resources in the Employee’s Severance Guarantee Fund (FGTS) — another Brazilian social security fund dedicated to workers in various sectors.

Throughout 2022, it operationalized more than $50 million and registered more than 1 million people who applied for and received loan pre-approval.

This is the company’s second contribution in such a short period.

In October of the previous year, iCred announced the raising of $20 million through a FIDC (Receivables Investment Fund), a type of investment in which the holders of shares have yields tied to resources derived from resources d from a company.

iCred started its business model by lending money to formal workers with FGTS resources.

Simplifying bureaucracy with an IA-based in-house platform

Now the company operates its resource anticipation system with an in-house platform whose premise is to streamline the bureaucracy as much as possible for almost immediate approval of the anticipation.

For this, the platform uses artificial intelligence to cross-reference information from several public databases of individuals.

According to the company’s data, the technology tracks the resources in up to 3 minutes. The Brazilian instant transfer system PIX sends the loan to the user’s accounts immediately after approval.

One of the company’s main bent is cross-selling with financial products from other companies, such as insurance from the Goias-based fintech EQ.

In addition to offering loans to INSS beneficiaries, the company is preparing the launch of a credit card for this first semester.

The startup expects to end the year with gross revenue exceeding $20 million.

  • Jorge C. Carrasco

    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.