PayPal Invests An Undisclosed Amount in Mobile Loans Service Tala

Tala

PayPal, an online money transfer and payments platform has reportedly invested an undisclosed amount in Tala, a microlending app. The investment is said to help Tala reach even more underserved populations in emerging markets.

The surge of mobile lending apps, especially in Kenya, has been propelled by the extensive use of M-Pesa as well as the need that these services solve. Apps such as Tala gives access to micro-loans of up to Kes.50,000 depending on the credit rating the app gives you, through its algorithms.

Despite their higher than normal interest, the microloans services continue to gain favour from the population since the process of accessing loans has been shortened to just owning an Android smartphone and having an M-Pesa account.

In a press statement, PayPal says that they share the same vision as Tala and that is the reason for the investment. “At PayPal, we believe that everyone should have access to transparent, convenient and secure financial services. Tala shares our vision of reimagining financial services, especially for the unbanked and those underserved by the traditional financial system. Tala empowers these people through innovative mobile solutions to improve their overall financial health and we are proud to help them achieve this goal,” said Mark Britto, senior vice president and general manager of global credit, PayPal.

Tala recently launched their Series C funding round, which is led by Revolution Growth and PayPal is the latest investor to hop on this train. However, the future of apps like Tala is on a grey area, after Google announced that they would limit the kind of apps that have access to SMS and Calls data, a permission that Tala needs to develop its credit rating for individuals.

The Kenyan government has also been called upon severally to play a role in regulating the market of mobile loans apps, which have been called out for collecting unnecessary data as well as charging exorbitant interest in the name of service charge.

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