UK trade finance challenger Diaspora preps for flight
London-based Diaspora is getting ready to spread its wings with the launch of its trade finance challenger entity.
Finance on the blockchain
The idea is to build a trade finance ecosystem where sellers, buyers, and funders can transact international trade and commodity finance deals over the blockchain.
Diaspora plans to offer SMEs “bespoke” funding solutions, including invoice factoring.
According to its website, it was created in 2017 by a group of entrepreneurs and bankers. It also has offices in Den Haag, in the Netherlands.
The firm says: “Whether you are a small coffee trader in Ethiopia, a wine exporter in Italy… we want you to come to us and be a part of Diaspora.”
It is based at the tech hub Level 39 in Canary Wharf. Ibrahim Farag is its MD and founder. He has plenty of experience in fintech – such as an investment strategist, investment director; and working at FIMBank in Cairo and Union National Bank in Dubai.
FinTech Futures contacted the start-up for more details.
In terms of its tech, Farag tells us: “We have developed our own backend that has been so far sufficient as a MVP. That being said, we have recently been approached by a leading outstanding providers of working capital/supply chain software, and for that our technology team now mulls the options of developing our own vs investing in an existing one. That option will be decided in line with the results of our fundraising campaign later in the summer.”
No specific names were offered but these are early days.
With regards to that funding, it will be “two tier fundraising”. So this involves transaction/debt funding that is mainly to fund others, and equity funding for growth and investing in technology, PR, compliance, and to recruit more staff.
Diaspora doesn’t have a banking licence at present as he says it doesn’t take client deposits or offer lending. Farag says the firm will apply for a licence during V4 of its project.
Diaspora joins a very long list of UK challenger banks. A comprehensive overview of them all is here.
