The Myanmar-based service plans to use the Unsecured SME financing to implement same-day payments to truck drivers
Burmese online truck shipment service Kargo has announced that it has inked an SME financing agreement with Yoma Bank, Myanmar’s commercial bank.
The partnership will see Kargo receive an initial loan of approximately US$130,000. Through the bank’s Unsecured SME Financing, Kargo plans to facilitate same-day payments to its truck drivers, boost its ability to grow its customer base, and manage all invoices.
Kargo was founded in 2016 with focusses on the country’s logistics and supply chain industry. Bootstrapped at first, what it does is it connects independent truck drivers, fleet owners, third-party logistics (3PL) companies, and commercial logistics providers directly with businesses that can get access to trackable distribution and delivery of their goods across the country.
Kargo claims that to date, the company has connected almost 2,000 truck drivers in Myanmar.
“When we first envisioned Kargo, we were starting out in an extremely fragmented market that had a very opaque pricing system. Now, our virtual fleet has become the largest one in Myanmar and completing over 5,000 deliveries to date,” said Alex Wicks, the Founder and CEO of Kargo.
Prior to this agreement, Kargo has raised a seed round from Singapore-based SEED Myanmar in 2017 as well as a six-figure grant in February 2018.
Kargo was the ‘Best Logistics and Supply Chain Startup’ at the Echelon Top 100 Start-up Competition, Kargo received US$50,000 prize from the Singapore government.
Furthermore, in its Pre-Series A round, it managed to raise a seven-figure sum from Singapore’s ‘Cocoon Capital’ and another private venture capital firm.
Kargo is the first company that Yoma Bank has offered this loan to since the Central Bank of Myanmar approved the disbursement of unsecured lending.
“Unsecured financing is solely based on the cash flow of the business and is a progressive way of supporting smaller enterprises. This financing is the first of many and we look forward to seeing innovative and tech-driven SMEs such as Kargo thrive in this market,” said the CEO of Yoma Bank, Hal Bosher.
Yoma Bank’s Unsecured SME Financing is a move by the bank to support the growth of Myanmar’s SMEs; which typically faces the problem of cash flow management.
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