Fintech: Digital Finance Platform Funding Societies Secures $27m in Debt

Funding Societies, also known as Modalku, Southeast Asia’s largest unified SME digital finance platform, has successfully secured $27 million in debt funding, led by private credit financier AlteriQ Global.

Multi-family office Aument Capital Partners (ACP) and sustainability-focused fund Orange Bloom also contributed to this funding round. The funds are set to support underserved SME segments in the five markets where Funding Societies operates, by being channeled via a broad range of tailored financing solutions.

SMEs are critical to Southeast Asian economies, constituting 99% of all establishments and contributing to 44.8% of the region’s GDP. However, financing challenges persist for 39 million MSMEs, creating a gap that amounts to $300 billion, according to the United Nations Capital Development Fund.

This initiative by Funding Societies aims to address such disparities and expand the range of access to its services, aiding SMEs in maintaining business cash flow.

Kelvin Teo, Co-Founder and Group CEO of Funding Societies | Modalku, expressed his delight, stating:

We’re delighted to receive this debt funding from such a diverse group of institutional investors, all of whom believe in our mission and growth story of serving Southeast Asia’s SMEs.

Funding Societies plans to grow its capacity in bridging financing gaps for SMEs in Southeast Asia and has started offering solutions beyond lending, like payments and collections, to help solve cash flow management challenges faced by SMEs.

To date, the company has achieved over $3.2 billion in business financing, processed more than 5 million transactions, and served about 100,000 SMEs across the region.

Zhi Yong Heng, Managing Partner of AlteriQ Global, praised the accomplishments and potential of Funding Societies, looking forward to collaborating as they continue to expand their digital financing solutions in the region.

This collaboration also aligns with Funding Societies’ commitment to sustainability, having implemented its Environmental and Social Management System (ESMS) earlier this year, focusing on ESG risk assessment during the loan application process by an SME.

ACP, which has known Funding Societies since its inception, sees the company as a core partner in providing credit access to SMEs in the region. Similarly, Orange Bloom’s Sustainability Fund aims to support SMEs transitioning to sustainable practices towards a low-carbon economy, aligning with Funding Societies’ initiatives.

Licensed in multiple countries in Southeast Asia, Funding Societies is the region’s largest SME digital finance platform, providing $1 billion annually in business financing to SMEs. It recently acquired regional digital payments platform CardUp and co-invested in Bank Index in Indonesia.

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