Nairobi and San Francisco-based mobile micro-finance company Branch has secured 9.6 Million US Dollars in its Series A equity funding round from Venture Capital firm Andreessen Horowitz, Khosla Impact, and Formation 8, to fund its expansion across Africa and other new markets.
This round of funding will allow Branch to scale its operations, hire new talent in Kenya as well as expand across the East African in year 2016.
This Series A Funding Round was led by Andreessen Horowitz (a16z); a prestigious US-based VC firm that has previously backed top international technology companies such as Facebook and Airbnb in their initial stages. The partner who invested on behalf of the fund, Alex Rampell, commented on the deal saying that “The combination of smartphones, digital money, and machine learning offers an opportunity to leapfrog old-fashioned credit infrastructure, and that’s precisely what Branch is doing”.
Founder and CEO Matt Flannery who founded Branch after 10 years at the helm of Kiva.org, the micro-lending website that today operates across 80 countries, spoke against the backdrop of the news of the huge round of funding saying that this latest round of funding would enable Branch expand further to meet the huge demand for their credit product in Kenya and enter new markets as well.
This week, Branch was able to disburse its very first loan in Tanzania, marking an important milestone towards its goal to expand to several African countries and disburse 1,000,000 additional loans to its customers in these markets.
150,000 people in Kenya are already using the app and the Branch App with each customer, on average, having taken out 3 loans ranging between from KES 250 to KES 50,000. These loans are typically approved within minutes, which makes the process smooth and stress-free for its customers.
The socially conscious technology company launched the Branch app in May 2015 to provide financial services to the rapidly expanding middle class in Kenya through its Android app that uses advanced data science to calculate a credit score for its customers by analyzing call and SMS history on their smartphones. This then enables Branch to meet the growing demand for credit among millions of Kenyans and disburse loans within minutes into customers’ mobile money wallets, while managing to maintain low default rates.
“Our product is simple. Forget about bank queues and month-long processes. Branch is like a bank in your pocket, there for you at all times. The proprietary technology we have developed means that we are able to charge lower interest rates than our competition, and reward users who repay on time with lower fees, larger loan amounts and more flexible repayment terms as they continue to use the app.” explained Daniel Szlapak, Branch’s Africa Director.
Branch App is currently available for download on the Google Play Store in Kenya and Tanzania.
