Digital credit platform ShopUp has raised $1.62 million in funding which could potentially help to automate the online sales and credit assessment process for small business owners in Bangladesh.
The funding round was led by Omidyar Network, an impact investment firm established by eBay founder Pierre Omidyar.
Other funders in this round include angel investors from Facebook, Google, Amazon, Grab, and leading global banks.
ShopUp is a Bangladesh-based startup that helps individuals including women entrepreneurs grow their online business and gain access to credit. It currently has 28,000 micro, small and medium enterprises (MSMEs) on its platform.
Seed money, the company said, will be used to enhance the core technology infrastructure of ShopUp's credit algorithm, and accelerate acquisition to 100,000 merchants.
In addition, the firm will also use the proceeds to 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, CEO and 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 model allows us to reach, engage and assess these MSMEs at a fraction of the cost using deep analytics and algorithm-driven models,’ he added.
According to ShopUp, currently, more than 60% of Bangladeshis are self-employed, and there are 350,000 shops on Facebook and nearly 300 e-commerce portals. About 10 million MSMEs remain outside the formal credit system.
Through ShopUp’s mobile application merchants in Bangladesh can gain access to tools like order management, catalogue management, and shipping payment, to name a few.