San Francisco based fintech Aura is closing $28.7m in residual debt financing from Angel Island Capital. The investment will help the firm to grow and expand its operations.
Fintech Aura is focused on making small-dollar loans to customers with little or no credit history. Specifically unlike traditional lenders, Aura’s goes beyond consumers’ credit score to assess the repaying ability of people borrowing money.
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The expansion loan comes at a time of rapid growth for Aura. Fintech Aura was founded in 2014. Since then, the company has provided approximately $500m in loans to more than 400,000 borrowers. The service is currently available in nearly 1,200 locations across California, Texas, Illinois and Arizona,
“Aura will use this expansion loan to scale and expand into new markets,” says James Gutierrez, CEO of Aura.
“Aura has received more than one million applications for our loans, and this number grows every day. By partnering with Angel Island Capital (AIC) we can keep up with the demand. And help fulfil our mission of providing affordable loans to millions of families in America.
Dev Gopalan, CEO, AIC adds: “Aura has created a unique model. It targets a niche lending market through its innovative approach and data-driven platform. Aura provides loans at scale with a high degree of confidence to borrowers with limited or no credit histories. We’re pleased to partner with Aura to support its growth providing fair and accessible loans to even more families.”
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By GlobalDataMillions of working families in America lack access to safe and affordable loans and are vulnerable to predatory lenders.
Fintech Aura: raising customers’ credit scores
Aura provides this underserved population with affordable loans. This helps consumers save hundreds of millions of dollars in additional fees and interest by avoiding predatory options. Two-thirds of Aura’s borrowers have grown their credit score by an average 285 points from their first to second loan.
Aura says that its loans are made possible by its innovative social bonds programme. This enables banks and other financial institutions to invest in loans to low-income individuals, while generating compelling returns. In total, Aura has raised over $431m in social bonds across 16 bond issuances.
Aura’s most recent investment was $10m raised from Prudential Financial in June.
