Jia, a DeFi lending startup, has successfully raised $4.3 million in seed funding.
The funding round was led by TCG Crypto, an early-stage investor, and included participation from several funds such as:
- TCG Crypto
- Hashed Emergent
- Saison Capital
- Global Coin Research
Additionally, Jia secured a further commitment of $1 million for on-chain liquidity. The funding will support Jia’s expansion efforts and enable it to further empower businesses in these under-served markets.
Jia aims to focus on expanding its operations in Kenya and the Philippines where it has already established a presence. Jia also plans to explore new markets in West Africa, Latin America, and Asia.
Jia was established in 2022 by a team of former executives of Tala, a Kenyan mobile loan app, including Zach Marks, Cheng Cheng, Ivan Orone, and Yuting Wang. The startup seeks to provide loans to micro and small businesses in emerging markets, leveraging decentralized finance (DeFi) in the process. Upon repayment, borrowers receive tokens which they can later redeem at a pre-determined rate based on Jia’s profits.
“The idea is to provide affordable financing for micro-businesses, and when they repay, they become owners by getting token rewards,” said Marks, Jia CEO and Co-Founder, adding that each token has a claim to a stream of revenues from Jia’s lending protocol.
The fintech has already launched its first on-chain pool with Huma Finance, an income-backed decentralized finance protocol. Borrowers can also use the tokens as security for lower interest rates, higher loan amounts, and more flexible loan terms.
Jia offers loans of up to $5,000, targeting small businesses in need of financing. The company aims to fill the gap left by digital lenders and loan apps that typically do not provide credit exceeding $1,000.
“The loans range in size from $200 up to $5,000 …they are really competitively priced. We charge about a third the interest rate of the typical consumer fintech lender,” said Marks.
Jia gets its customers by integrating into the apps of its local partners like Ilara Health which supplies medical inventory to a network of over 2,000 small clinics.
“Ilara’s focus is on helping clinics grow by selling medicine, low-cost diagnostic devices. They don’t want to deal with credit risk on their balance sheet, so we step in to finance an inventory financing program for them. We get access to proprietary data on these clinics which helps us underwrite in a way that banks and other lenders can’t,” said Marks.
Jia ia also trying to replicate community financing, commonly referred to as ‘chamas’ in Kenya, where members borrow and also hold shares to earn from the group.
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