Peer-to-peer lending startup Lendico will launch in South Africa, its parent company Africa Internet Holding has announced. Mobile telecommunications companies Millicom and MTN, together with venture capital firm and startup incubator Rocket Internet, which is backed by J.P. Morgan, hold shares in AIH.
Lendico launched in Germany at the end of 2013, and has since expanded to Spain, Poland and Austria. South Africa will be the first market it has entered outside of Europe.
The company aims to offer a credible financing solution to what it calls the “underbanked” – those who struggle to get loans from banks.
Jeremy Hodara, co-founder of AIH, explained: “We have high standards when it comes to selecting borrowers, because we always have the interests of our investors in mind. Due to our cost advantage, Lendico can offer more affordable interest rates and smaller loan sums that for banks usually are not worthwhile”
Rocket Internet is well known for taking promising startups and bringing them to emerging markets, and its better known investments include Groupon, eBay, Facebook, Linkedin and Zynga.