Fintech company Transigo, a provider of SaaS software that enables cross-border B2B marketplaces to provide point-of-sale financing to its buyers, announced it had successfully secured up to $70 million funding facility from two publicly listed companies in Israel: E.N. Shoham Business Ltd and Nawi Brothers Group Ltd with a business potential for increasing funding. This facility will allow Transigo to expand its point-of-sale SaaS platform to major B2B marketplaces in Asia in the first quarter of 2022.
“Cross-border B2B eCommerce is booming, with the market in China alone expected to hit almost $1 trillion in 2022. However, lack of credit is limiting growth. This is especially the case in Asian B2B marketplaces, which typically provide zero credit terms. Transigo is helping remove these financing constraints. This funding engagement, being with two public companies, will enable us to connect with more traditional institutions such as banks. This will further strengthen our financing capabilities,” says Nir Tal, CEO of Transigo.
He added, “We expect to complete integration with multiple major Asian B2B marketplaces in the first quarter of 2022. And that’s only the beginning for us – we are planning to increase the size of our total funding facilities by an additional $250 million in the first half of 2022. This will enable us to integrate with even more marketplaces and drive exponential growth in both financing volumes and revenue.”
Transigo’s point-of-sale SaaS platform integrates with the marketplaces’ platforms via a secure API and enables the marketplace to offer approved buyers up to $80,000 in point-of-sale credit with a maximum term of 90 days. Approvals can be completed within minutes. As buyers are usually small-and-medium-sized enterprises with limited working capital, providing such deferred net terms can help improve the marketplaces’ buyer experience, boost retention, increase average order values, and reduce exposure to seasonal fluctuations. Using Transigo’s invoice factoring platform, the marketplaces bear no credit risk or cost – creating a win-win situation for them, the buyers, and Transigo.
To assess prospective buyers and minimize risk, Transigo uses an AI deep learning-based scoring algorithm that has been tested and shown to be able to provide highly accurate estimates of a buyer’s future financial performance. Transigo also further caps its downside risk by using an innovative structure with high credit insurance coverage and direct pulls from the borrowers’ bank accounts for settlement payments.
Fred Simon, Transigo’s lead investor said, “The potential in providing a scalable SaaS-type solution that can help bridge the financing gap in cross-border B2B marketplaces was evident to me from the get-go. I’m glad that Transigo has been executing on its plan and I think it has a real possibility of becoming a genuine leader among the next generation of fintechs.”
