Tel Aviv’s Liquidity Capital and Japanese Financial Giant MUFG Establish $80 Million Initiative for Asian Digital Commerce Startups

An Israel-based AI technology firm is planning to help MUFG Bank, which is Japan’s largest financial institution, with assessing the operations of Asian startups in order to determine the feasibility of issuing loans to them.

The $80 million 50-50 joint initiative between Tel Aviv based Liquidity Capital and MUFG Bank will be established in Singapore under the company name, Mars Growth Capital Pte. Limited. It will focus on digital commerce, education, and healthcare services. The initiative will involve monitoring or screening firms’ bank accounts, accounting information, and other data using the latest AI technologies

Mars Growth will aim to provide various financing options to e-commerce companies, health service providers, and firms focused on the education sector.

MUFG bank is a subsidiary of Mitsubishi UFJ Financial Group. Meanwhile, Liquidity Capital was launched in 2017 by Meitav Dash Investments Ltd, an Israeli investment firm.

MUFG had initially invested in Liquidity Capital’s digital technology last year via its corporate VC  division, Mitsubishi UFJ Innovation Partners Co. Ltd.

MUFG’s management noted:

“With [our] core strategies being digital transformation and growth in [the] Asia Pacific [region], [we will work] with Liquidity Capital again in its business development to provide advanced financial solutions to support the startups in this region.” 

They added:

“This agreement therefore brings to fruition these positive discussions and realizes the complementary strategic goals of both parties: the expansion of Liquidity Capital’s business and market value, and MUFG’s commitment to growth in Asia Pacific through leveraging the latest digital technology in the provision of advanced financial services.”

Liquidity Capital uses a special or customized credit scoring model, which has been implemented using AI technology. The software is used to determine the creditworthiness of companies by using real-time financial and accounting information which is obtained from the customers’ bank accounts, with their consent.

The software also reportedly includes accounting systems and CRM data that is obtained via APIs. This data is used to project a business’ future earnings and cash flow requirements.

Ron Daniel, CEO at Liquidity, remarked:

“This joint fund comes on the back of 18 months of [our] close partnership and is the first sign of a wide-scale collaboration across the world of bank credit that will completely change it over the coming years.”

Based in Tokyo, the MUFG Group has a large international network with more than 2,700 locations in over 50 different countries. The group has more than 180,000 professionals on its payroll and provides services such as asset management, commercial banking, consumer finance, credit cards, securities, leasing, and trust banking.

Masato Miyachi, CEO of global corporate and the investment banking business division at MUFG Bank, noted:

“In the era of digital transformation, this partnership will enable us to become more competitive and relevant to our clients, and through the provision of innovative solutions for the startup companies, we will be able to further promote financial inclusion and sustainable growth in the region,”

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