AdalFi, a fintech company based in Pakistan that specializes in credit scoring data and lending technology for banks, has successfully secured $7.5 million in Seed funding.
The funding round was spearheaded by Cotu Ventures, Chimera Ventures, Fatima Gobi Ventures, and Zayn Capital, joined by angel investors that include executives from Plaid.
AdalFi aims to address the challenges of Pakistan’s “broken” loans market, which currently depends on banks conducting numerous manual checks on customers due to a lack of reliable credit scoring data.
The company’s technology suite features AI-driven credit scoring and underwriting models, alongside the essential infrastructure to facilitate quick, smart loans for both consumers and small to medium-sized enterprises (SMEs). Their offerings include a range of unsecured loan products such as term loans, credit cards, and revolving finance options tailored for consumers and SMEs.
In just two years, AdalFi has partnered with 14 banks—seven of which are among the top ten—and has achieved a 30% month-on-month growth in loan volumes over the past 19 months.
The company employs a revenue-sharing model that mitigates downside risk for partner banks, ensuring that any potential loan losses are proportionately reflected in the fees owed to AdalFi.
Salman Akhtar, CEO and co-founder of AdalFi, stated, “Pakistan has 50 million bank accounts, yet only two million individuals and businesses have any credit relationship with their bank. The high cost of loan origination, fueled by the need for physical verification of identity, assets, and financial health—without any credit scoring—has limited credit access to a small, elite group of customers. AdalFi’s digital lending platform enables partner banks to instantly credit score the remaining 95% of their existing customers who have never received loans, allowing them to cross-sell loan products effectively.”