UK consumer lending start-up Koyo Loans closes down
UK-based consumer lending start-up Koyo Loans has closed down, with all the company’s existing loans being transferred to third-party company Capquest for management.
Koyo Loans has wound down its operations
A credit solutions and debt recovery business, Capquest was appointed to service Koyo Loans on behalf of Koyo Finance 1 Ltd last month. It says on 3 July, customers were contacted with an update stating that from 14 July, Capquest will be managing their accounts.
As first reported by AltFi, Koyo Loans investor Forward Partners, which contributed to Koyo’s Series A round in 2021, revealed it was writing down its investment in the fintech firm.
In a portfolio update dated 24 July, Forward Partners writes: “As outlined in Forward’s full-year results, in 2022, AI-powered lending platform Koyo Loans experienced difficulties raising new capital amid the prevailing economic uncertainty and initiated a consultation process.
“The outcome of this process has led Koyo to transfer its existing loan book to a new service provider and to initiate a wind-down of the company.”
The news comes despite the firm expanding its debt facility to £100 million and securing an additional £5 million in equity as part of a Series A extension last year.
Headquartered in London, Koyo was founded in 2018 and launched its open banking-led lending platform in 2020.
It aimed to furnish loans to customers who struggled to gain access to credit through traditional means by utilising AI and open banking data to gain an “information advantage” over other banks and lenders for a more accurate risk assessment.
