Bogota-based FinMaq uses alternative credit-scoring to help informal, micro and small businesses borrow to acquire equipment to boost their livelihoods. FinMaq provides loans in partnership with more than 40 machinery distribution companies.
Since launching in 2022, the company has loaned $17 million to about 550 borrowers, 30% of whom had no formal credit history; half are based outside of urban areas.
Bogota-based impact investor ALIVE Ventures led the $29 million mixed debt and equity round to support the company’s growth in agriculture, construction and healthcare.
“The financial solutions provided by the company are reaching a critical segment of the economy, traditionally underserved and challenged by informality,” said ALIVE’s Santiago Álvarez.
Venture capital firm 30N Ventures also invested.
Fintech for impact
The explosion of fintech solutions during the pandemic pushed impact investors toward “productive uses,” in which financing is directly connected to livelihoods, rather than consumption. FinMaq finances, for example, machines for metalworking, packaging, dentistry, and cranes and other construction equipment.
FinMaq reports that, for 55% of its clients, the equipment it finances becomes borrowers’ main sources of income. FinMaq says each machine it has financed has supported the creation of two new jobs on average.
