Heaptalk, Jakarta — Modalku has obtained a debt fund facility worth US$7.5 million, approximately Rp117 billion, from Northfund – a Development Financial Institution (DFI) which operates the Norwegian government’s investment fund for developing countries. This funding is the initial investment of Northfund with an MSME funding platform in Southeast Asia.
According to the company, this funding is the second most significant debt facility obtained this year. As is well known, my capital received debt funding of US$27 million from AlteriQ Global, Aument Capital Partners, and Orange Bloom. The fund will be channeled through various Modalku financing services devoted to MSMEs in Indonesia, Singapore, Malaysia, Thailand, and Vietnam.
Responding to this matter, Co-Founder and Group CEO Modalku, Kelvin Teo, said, “It is an honor for our group to collaborate with Northfund, supported by the Norwegian government. This achievement is proof of our creditworthiness in facing the pandemic and macroeconomic uncertainty. This achievement is an opportunity to meet the need for access to funding for MSMEs still underserved in SEA.”
Based on data obtained by companies from ASEAN, around 99.9% of the total businesses in the ASEAN region are categorized as MSMEs. They have contributed to 44.8% of gross domestic product (PDB). For this reason, the strategic funding that the Modalku platform granted would be a bridge to Northfund with the public and private sectors in expanding its investment in Southeast Asia.
In addition, DFI’s impact investment in Southeast Asia has reached US$ 2 billion from 2017 – 2022, with more than half of this investment portfolio being disbursed to the financial services sector. DFI entities are claimed to contain the ability and capacity to back MSMEs that commercial and government funders cannot support due to their robust financial position.
“We are impressed with Modalku’s ability to support underserved MSMEs in Southeast Asia with various funding solutions to support these fintech companies in expanding their reach, increasing financial inclusion, and enabling more businesses to grow and create much-needed jobs in the region.
Hitherto, this investment company has distributed funding of around US$4.54 billion, or equal to Rp70 trillion, dedicated to 7.5 million clients. Meanwhile, Modalku has provided financing access of over US$3.3 billion (around Rp53 trillion) to more than 100,000 MSMEs in Southeast Asia.
