The Bulgarian unit of Germany-based Varengold Bank acquired a 20% stake in the peer-to-peer lending startup company Klear, Varengold announced on June 3.
Varengold Bank launched operations in Bulgaria in November 2018 and has said that it will focus on supporting innovative new companies and business models. The bank is specialised in marketplace banking, funding non-banking enterprises, and providing fintech solutions, mainly platforms for peer-to-peer lending.
The stake in Klear is the first acquisition of shares in a fintech company in SEE for Varengold Bank.
Varengold Bank will back Klear with BGN1.5mn (€770,000), which includes the acquisition of the stake and a loan. Klear will use the funding to expand in SEE.
"Supporting the development and growth of P2P lending platforms and fintech players like Klear is one of Varengold’s key priorities in Bulgaria and SEE," said Sergey Panteleev, general manager of Varengold Bank's Sofia branch, in a statement.
"These marketplace platforms are growingand expanding their operations. They are reshaping the conventional approach in the financial industry and will step-by-step replace traditional ways in lending, simply by providing significantly more favourable terms and conditions to borrowers, improving access to funds for consumers and also making raising funds more affordable. This is a fundamental change on the market and we are satisfied to take part in it actively."
So far, 1,175 investors have used the Klear’s platform to provide 938 loans worth combined BGN8mn.
Varengold Bank said at the end of 2018 that in 2017, peer-to-peer lending platforms secured €3.8bn funding for European companies.