Global fintech, MODIFI has announced a new $60 million debt facility with Silicon Valley Bank (SVB), bringing its total raised capital to $111 million. The facility from SVB’s German Branch will be used to address increasing demand in India and other existing markets, as well as fuel MODIFI’s continued growth in new geographies, particularly the US.
The venture claims, expansion into the US, paired with the existing coverage, will establish MODIFI as the only digital trade finance platform focused on SMEs that spans the three major trading regions of Europe, Asia and North America - a cluster that encompasses approximately 80 percent of global imports and exports respectively.
“We are very excited at the boost this partnership with Silicon Valley Bank will bring to our Indian business,” says Co-Founder & CEO, Nelson Holzner. “Following our acquisition of PrimaDollar’s export finance business recently, we doubled our customer base in the market and expect to grow 5X this year. We are well on our way to our goal of distributing $ 1 billion to Indian SMEs by the end of 2023”.
MODIFI’s Indian business represented around 30 percent of the company's financed volume in 2020, making it the largest single market. The establishment of offices in both the US and China is of particular value to Indian SMEs, since the two nations are the country’s biggest trading partners, accounting for more than $150 billion of exports - around 50% of the total. Ravi Narwani, MODIFI’s Head of India, hopes this local presence can help close deals for Indian customers.
“Despite the unprecedented disruption to the world's economies, 2020 proved a strong year for MODIFI. We were well-positioned to step in and address the needs of Indian SMEs, who have begun to recover impressively from the pandemic, with double-digit growth in sectors like agro and metals” says Narwani. “Our simple tech solutions allow us to digitally underwrite our customers and provide them with export financing in a matter of days, far faster than a bank”.
The Indian government has recently reiterated its commitment to supporting SMEs and is aiming to increase the number of those exporting from 127,000 to 5 lakh, whilst doubling their export output. MODIFI’s hopes that by helping its customers grow with fast and flexible finance, it can help the nation achieve the goals set out in the new Foreign Trade Policy.
“We’re pleased to become a new funding partner to MODIFI to support its geographical expansion to the US, further investment in its digital platform and continued growth. Our partnership builds on the momentum of SVB’s warehouse financing platform in EMEA as it showcases our ability to be a key partner in financing global innovators like MODIFI”, says Folake Shasanya, Managing Director of Fintech Warehousing at SVB EMEA.
MODIFI tripled their business in 2020 as a result of a strong performance during the pandemic. The increase in demand for digital cash management solutions allowed the company to expand to four new markets in 2020, launching in China, Hong Kong, the UAE and Spain. The trend has continued in 2021 with MODIFI’s launch in the Netherlands. The company currently operates out of 7 offices in Berlin, Amsterdam, Delhi, Mumbai, Shenzhen, Hong Kong and Dubai.
MODIFI’s digital trade finance platform provides SMEs with buyer and seller financing in a matter of days. Founded in 2018, MODIFI is tackling a $20 trillion industry in which 50 percent of requests for Trade Finance by SMEs are rejected by banks, resulting in a funding gap of $1.5 trillion annually.