Mexican challenger bank Albo has secured a USD 19m extension to its Series A financing, led by U.S.-based Valar Ventures. The neobank previously raised USD 7.4m at the beginning of 2019, bringing the company’s total Series A funding amount to USD 26.4m. Mountain Nazca joined Albo’s Series A.
This marks one of the larger early rounds for a Mexican startup. Albo joins the ranks of other Mexican startups that have raised larger-than-average Series A rounds, like Y-Combinator backed scooter company Grin that scored a USD 45.7m Series A and Klar, the Chime clone that raised USD 57.5m in debt and equity seed funding.
In its current form, Albo is a Mastercard debit card and a personal finance app that allows customers to open a bank account in five minutes through a branchless experience. The challenger bank tech startup concept is one of the most lucrative opportunities in Mexico — which is the second-largest economy in Latin America behind Brazil. Out of the 130 million population of Mexico, 45% are underbanked. While underbanked users have access to bank accounts, deep financial products designed to help them compound wealth through lending and savings features do not exist in the Mexican market through traditional banks. This leaves what founder 31-year-old Angel Sahagun describes as a total addressable market of 59 million people in Mexico alone.
Traditional banks don’t serve the Mexican population. Existing incumbents shy away from lending, lack transparency, have high fees and are known for bad customer service.
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