- Tala — a company that provides a credit profile to provide uncollateralized loans to millions of people in emerging markets — has raised $110 million and is now valued at over $750 million
Tala — a Santa Monica, California-based company that provides a credit profile to provide uncollateralized loans to millions of people in emerging markets — announced it raised $110 million in a Series D round of funding to enter the fintech space in India.
This round of funding was led by RPS Ventures. And GGV Capital and previous investors IVP, Revolution Growth, Lowercase Capital, Data Collective VC, ThomVest Ventures, and PayPal Ventures also joined the round.
According to TechCrunch’s sources, Tala is now valued at more than $750 million. Plus Tala also raised an additional $100 million in debt including a $50 million facility led by Colchis.
How does Tala work? Tala looks at the text messages and call logs of its customers along with merchant transactions, overall app usage, and other behavioral data through its Android app in order to build credit profiles. And based on these pieces of information, its machine learning algorithms evaluate the individual risks and provide instant loans in the range of between $10 to $500 to customers.
What distinguishes Tala from other loan sources is that banks use credit scores and online lenders review financial histories. Tala approves loans within minutes and distributes the money with mobile payment platforms. So far, Tala lent over $1 billion to more than 4 million customers to date. This is up from $300 million in loan to 1.3 million customers last year. Tala founder and CEO Shivani Siroya revealed these milestones in an interview with TechCrunch. Siroya has launched Tala after interviewing thousands of small and micro-businesses.
Over 90% of Tala users pay back loans in 20 to 30 days and are recurring customers. And to help its users with their credit history, Tala reports its rankings to local credit bureaus so that they can secure bigger and long-term loans in the future. To generate revenue, Tala charges a one-time fee as low as 5% each.
In conjunction with the funding round, RPS Ventures founding general partner Kabir Misra has joined the company’s board of directors.
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