The company is a digital credit platform facilitating working capital to small-business owners and home-based entrepreneurs in Bangladesh
SINGAPORE, Nov. 12, 2018 /PRNewswire/ — ShopUp, the FinTech platform designed to automate the online sales and credit assessment process for small-business owners in Bangladesh via Facebook and other social platforms, announced it raised USD 1.62 million (SGD 2.23 million) seed round led by Omidyar Network, the impact investment firm established by Pierre Omidyar, the founder of eBay. Other funders in this round include angel investors from Facebook, Google, Amazon, Grab, and leading global banks.
ShopUp helps individuals build and grow their online business, gain access to credit, increase earnings, and become financially healthy and secure. The funding, which also includes a grant from UK AID, will be used to enhance the core technology infrastructure of ShopUp’s credit algorithm, accelerate acquisition to 100,000 merchants, and establish partnerships with e-commerce players, logistics companies, and offline aggregators.
"Many entrepreneurs in Bangladesh still lack access to formal credit services, making it hard to grow and scale their small businesses," said Afeef Zaman, the CEO, and cofounder of ShopUp. "There is a long tail of micro- and nano-enterprises with annual turnover of less than $20,000 who generally don’t have access to affordable credit due to high operating cost of micro-loans. Our unique model allows us to reach, engage and assess these MSMEs at a fraction of the cost using deep analytics and algorithm-driven models."
More than 60 percent of Bangladeshis are self-employed, and there are over 90 million internet subscribers in the country. Additionally, there are 350,000 shops on Facebook and nearly 300 e-commerce portals.
ShopUp currently has 28,000 micro, small and medium enterprises (MSMEs) on its platform, the majority of which are led by female entrepreneurs like Rapunzel’s Secret Hair Oil. In Bangladesh, female employment has seen a 35-percent increase, reaching 18.1 million from 2008 to 2017.
"Access to flexible, affordable credit is the key to unlock growth in the MSME sector in emerging markets, and ShopUp’s mobile-friendly platform is helping to drive economic development, innovation, and employment in Bangladesh," said Smita Aggarwal, Investments director at Omidyar Network. "It is heartening to see that ShopUp supports women entrepreneurs with tools to build their business and a stronger financial position."
Value PropositionAccording to the World Bank, the total MSME credit gap stands at USD 2.6 trillion worldwide, due to the high operating cost (18 cents per dollar lent). The majority of this gap exists in developing and underdeveloped countries such as Bangladesh, where the majority of the 10 million MSMEs remains outside the formal credit system. However, in the last decade, a massive global shift is taking place, as many MSMEs are turning to online financial services and connecting to digital ecosystems. Right now there are 350,000 MSMEs on Facebook in Bangladesh — growing at a 70 percent rate yearly. This creates a massive potential for algorithm-driven credit models like ShopUp, without high operating costs.
How It WorksMerchants can register via ShopUp’s mobile app or through the website to gain access to a range of shop management tools, including order management, catalogue management, preferred rates for online ads, digital payments, and shipping solutions. ShopUp works closely with Facebook and also partnered with BRAC, one of the largest microfinance institutions globally providing working capital loans. BRAC operates in 11 countries across Asia and Africa. In 2017, BRAC has disbursed $3.6 billion in micro-loans to 5.6 million borrowers in Bangladesh. Merchants registered with ShopUp are eligible to apply for a collateral-free loan via ShopUp’s mobile app.
ShopUp is a digital credit platform that helps online MSMEs access affordable working capital micro-loans at a reduced cost by automating their online sales and credit assessment process. ShopUp currently has 28,000 MSMEs on its platform. You can learn more here: https://shopup.com.bd.
About Omidyar NetworkOmidyar Network is a philanthropic investment firm dedicated to harnessing the power of markets to create an opportunity for people to improve their lives. Established in 2004 by eBay founder Pierre Omidyar and his wife Pam, the organization invests in and helps scale innovative organizations to catalyze economic and social change. Omidyar Network has committed more than $1.3 billion to for-profit companies and nonprofit organizations that foster economic advancement and encourage individual participation across multiple initiatives, including Financial Inclusion, Digital Identity, Education, Emerging Tech, Governance & Citizen Engagement, and Property Rights. You can learn more here: www.omidyar.com.
Logo – https://photos.prnasia.com/prnh/20181112/2296600-1LOGORelated Links :https://shopup.com.bdhttp://www.omidyar.com