Founder: Shivani Siroya (CEO)
Launched: 2014
Headquarters: Santa Monica, California
Funding: $450 million
Valuation: N/A
Key technologies: Artificial intelligence, machine learning
Industry: Fintech
Previous appearances on Disruptor 50 List: 3 (No. 22 in 2022)
Continuing on its mission to serve some three billion people worldwide who are overlooked by traditional banking institutions, mobile technology and data science player Tala has stepped up with a new digital wallet app and is increasingly relying on proprietary artificial intelligence and machine learning to personalize micro-loans, credit, and financial services for customers.
Founded in 2011 by CEO Shivani Siroya in Santa Monica, California, the fintech startup upped its loans to more than $3.4 billion across nearly 8 million unbanked and underserved people around the world in 2022. That’s up from $2.7 billion to more than 6 million people the year before, as the popularity of digital financial services continues to grow in the wake of Covid.
Tala offers micro-loans between $10 to $500 for consumers and small businesses through its smartphone app. The financial sweet spot for Tala aims to create a more equitable financial system in emerging markets including Kenya, the Philippines, Mexico and India. The company says there are over 22,000 sign-ups daily for its services, from account holders who otherwise might have to resort to loan sharks or informal lenders.
Last November, Tala launched a new app with digital wallet features that moves beyond lending. Customers receive credit to their Tala wallet to manage money without fees, and eliminating the need to go to a remittance center for their money. There’s a single sign-on for account and credit applications.
Tala relies on data analytics, examining a user’s online behavior, device, mobile bill payment history and some 250 data points to build a credit score — without personal identification such as a voter card. Using this approach, Tala can typically approve borrowers and send the money to their mobile wallet in under two minutes. This system is similar to that used by insurance tech startups, such as Branch, which look at driver history and habits to determine premiums in providing auto coverage.
A friction point for Tala is growing concern over data protection. Tala maintains that data is encrypted and personal info is not shared with third parties.
The startup has had a positive impact among borrowers. Speaking at the Forum of Young Global Leaders, part of the World Economic Forum, Siroya said Tala users’ ability to better manage expenses and gain greater control and confidence over financial decision-making has improved their lives.
Currently profitable, Tala recently upped its employee numbers by 20%. It is riding a $145 million, fifth round of venture capital raised in late 2021 before the VC market clamped down on new equity rounds, to further expand its lending and money management services. Tala investors include PayPal Ventures, UpStart Ventures and GGV Ventures, as well as blockchain network Stellar Development Foundation.
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