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TechCrunch Fintech: PayJoy is a fintech company dedicated to doing good and making money

Welcome to TechCrunch Fintech! This week, we’re looking at the performance of two fintech companies serving underserved populations, and more!

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big story

Alipay is an example of a company with positive unit economics and a mission to help the underserved. We rarely see these two things cross over, so when we do we get super excited. I wrote about the company hitting the milestone of $300 million in annual revenue and profitability last year, while also successfully raising $150 million in Series C funding. The company’s model is unique: It helps people build credit through pay-as-you-go financing for smartphones. Once the phone is paid off, customers can apply for a loan through PayJoy using their device as collateral. Read all about its growth here.

Analysis of the week

petal is another fintech company aiming to help underserved people “build credit, not debt.” Last May, TechCrunch reported on the company raising $35 million and planning to spin off its data division. Last week, Empower Finance announced plans to acquire Petal, which apparently began looking for a buyer last year “when it was short on cash,” Fortune reported. A spokesperson for Petal told me via email: “Like Petal, Empower … uses cash flow underwriting for its suite of credit products. … With the Petal acquisition, it will soon have a line of credit cards to complement the offering.” Will we see more mergers and acquisitions in 2024? I’d love to see it.

dollars and cents

transfer toThe UK-based fintech company known for its global consumer platform for remittances has raised $10 million in growth funding from Taiwanese investor Taiwania Capital as it looks to expand in the Asia-Pacific region. It last raised $50 million in Series C funding in 2021. TransferGo claims that its growth, coupled with the new investment, has doubled its valuation.

What else should we write?

Brazilian Startups SalviThe accelerator confirmed to TechCrunch’s Anna Heim that Y Combinator, an enterprise mobile operator, is the only company in the latest batch of Y Combinator to be based in Latin America. That’s a significant decrease compared to the remote cohort that attended accelerators during the pandemic, but it’s also a significant decrease compared to recent courses. For example, Y Combinator’s winter 2022 batch included 33 Latin American companies. Is the overall state of the fintech industry partly to blame? Historically, about a third of the 231 Latin American companies participating in YC have focused on fintech. As fintech funding dwindles, this may partially explain YC’s lack of interest in Latin America.

High-profile headlines

The “most hated” financial technology and e-commerce industries among investors

Stride and Utah set new precedent for independent worker benefits

US startup Parafin secures warehouse facility worth $125 million from SVB and Trinity Capital

Tabs secures $7M in seed funding to power AI-powered accounts receivable platform

UAE fintech company Fortis secures US$20 million in Series A funding

Anrok reaches a $250 million valuation with a mundane idea: computing

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