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Mexican FinTech Credijusto raises $100mn to boost loans amid COVID-19

Mexican FinTech startup Credijusto has announced that the company has raised $100 million in debt from Credit Suisse Group, according to Reuters. The funding took place as a move to help extend more loans to SMEs in a period when there is turmoil in the financial markets from the global pandemic COVID-19 virus.

Small and medium-sized companies are struggling to have finance access from Mexican banks. The problem could worsen if financial institutions take a more conservative stance.

Even though the deal initiated before the coronavirus epidemic intensified, it closed last week amid significant upheaval in financial markets. Credijusto with its Credit Suisse cash infusion is aiming to bridge the financing gap.

As Mexico continues on a path towards greater financial inclusion, a significant part of the population remains unbanked. The Mexican government has said that it is looking forward to FinTech to help aid the situation.  Mexican FinTech startups are gaining investor attention and are finding investors, including Silicon Valley investors and Japanese conglomerate SoftBank.

“It is going to be a more challenging time for raising capital and that’s not just in Latin America, that’s everywhere. The market turmoil could create opportunity for Credijusto, noting the startup has seen an uptick of interest from small and medium-sized business in recent weeks. Small and medium-sized enterprises in Latin America are massively underserved to begin with, and any shock like this tends to make banks retrench,” said Michael Sidgmore, a partner at venture capital firm Broadhaven Ventures, which has invested in Credijusto.

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