IFC has joined a $25 million Series A extension round for the Philippine fintech firm Salmon Group Ltd to enable consumer fintech to develop new credit products and boost access to banking among the underserved.

Salmon Group Ltd, a consumer fintech that focuses on providing short-term credit to consumers underserved by traditional banks, has announced that the International Finance Corporation (IFC), a member of the World Bank Group, has invested $7 million in the startup within its Series A extension round (Series A-1) as a lead investor.

Among other investors, participating in the funding round, there is also Northstar Group, a Singapore-based private equity and venture capital fund manager.

Salmon Group plans to use fresh funds to develop new credit products and a lifestyle banking offering, which is supposed to launch in the second half of 2024.

Raffy Montemayor, a co-founder of Salmon, said the firm was excited to welcome IFC and Northstar as its partners. The startup, which uses AI and a proprietary credit engine to offer market-disruptive consumer loans, claimed that it would also further cooperate with IFC to strengthen its role as a responsible lender.

Jean-Marc Arbogast, Country Manager for the Philippines at IFC, confirmed that its $7 million strategic investment reflected the corporation’s confidence in Salmon’s vision. Investment in Salmon is a step towards providing modern, affordable, and easy-to-access banking services to every Filipino via pioneering AI-enabled credit tools. IFC representatives also hoped that the emergence of such innovative products in the country would disrupt the market and traditional lenders and fill critical gaps in the banking industry.

According to the Bangko Sentral ng Pilipinas (BSP), only 25% of the Philippines’ adult population has access to formal credit. Thus, the majority of local citizens remain underserved by existing banks, especially when it comes to access to modern tech-driven credit products.

Founded in July 2022, Salmon received the approval of the Central Bank of the Philippines, the Bangko Sentral ng Pilipinas (BSP), to become a licensed bank in December 2023. This license allows the institution to expand the range of provided financial services with deposit accounts, debit and credit cards, and other transactional products.

Last year, Jack Madrid, President of the IT and Business Process Association of the Philippines, said that this Southeast Asian country should use artificial intelligence (AI) technologies to raise the IT and Business sector to new heights of efficiency. For the Philippines, the integration of machine intelligence is of strategic importance.