P2P lending platform Validus raises US$20m in Series B+ round

Singapore

SINGAPORE-BASED peer-to-peer lender Validus Capital has raised US$20 million in its ongoing Series B+ funding round, led by K3 Ventures-managed Kuok Group's Orion Fund, and the Vertex Growth Fund.

Existing investors FMO (Netherlands' public-private development bank), Vertex Ventures South-east Asia and India, Openspace Ventures, Thai firm Siam Cement Group's

AddVentures, and Vietnam's VinaCapital Ventures also participated in the round.

Validus will continue to invest heavily in technology and firm up its position in Singapore, Indonesia and Vietnam. The fresh funds will also support the company's expansion to Thailand in the fourth quarter.

Validus launched its Indonesian entity, Batumbu, and Vietnam entity, Validus Vietnam, last May and November respectively.

It is currently applying for a Securities and Exchange Commission crowdfunding licence in Thailand. It estimates the market opportunity there to be between US$30 billion and US$35 billion on unmet small and medium-sized enterprises (SME) credit demand, co-founder Nikhilesh Goel told The Business Times.

"We are highly impressed by the leadership and depth of credit management experience at Validus," said Kuok Meng Xiong, managing partner of K3 Ventures.

"The team has demonstrated the unique ability to capture critical data points, combined with comprehensive machine learning capabilities, to identify high-potential SMEs that may have fallen through the cracks of the traditional banking model."

Validus' total loans disbursed to date have exceed S$453 million. Its non-performing loan ratio - which refers to loans past 90 days due - was 2.69 per cent last year, up from 2.5 per cent the year before. As of April 16, 2020, some 60 per cent of the overdue loans had been recovered.

Mr Goel said the company is seeing a healthy demand for short-term financing during the Covid-19 outbreak. Over the last three months, there was an average 50 per cent increase year-on-year on its disbursement volume.

On the investment front, Validus has drawn interest from institutional lenders and high-net-worth individuals for specific SME financial offerings.

Asked about the impact of the Covid-19 crisis on the firm's portfolio, Mr Goel said: "While there has not been a material impact to our portfolio - as the industries most impacted are hospitality, tourism, etc, which we do not have much exposure to - we expect to see a few SME loans getting stretched as repayments may get prolonged and cash flows will be slower in the coming months."