International payments company LemFi has acquired London-based credit FinTech Pillar to further help immigrant communities with fair, fast and accessible financial services.
California-based LemFi recently became the first major remittance platform to integrate credit into its core product, following the launch of LemFi Credit.
The firm says that the Pillar acquisition paves the way for deeper, specialised credit services and cards designed specifically for immigrants.
The deal will also see Pillar’s co-founders and Revolut alumni Ashutosh Bhatt and Adam Lewis join the LemFi team.
With over 2m customers across the US, UK, Canada and Europe, $1 billion in monthly transaction volume and with expansions in Asia and Latin America, LemFi looks to enable users to open multi-currency accounts and send and receive money globally, reliably and at a low cost.
This approach has seen the platform grow 30% month-on-month and the business recently raised a $53m (£39m) Series B funding round led by Highland Europe.
In the UK alone, around 64% of adults have at least one credit card and, every month, 83% of the population uses some form of credit or loan product, making up an £645m market.
Yet around five million people are “credit invisible”, meaning they lack a significant credit history, making it difficult for them to access financial products and services.
Regardless of financial standing or employment, their lack of credit history makes them four times more likely to be excluded from essential services.
Pillar’s alternative credit-scoring model uses global credit insights and non-traditional data to help solve this, assessing eligibility and helping users build a financial footprint from day one.
Such is the demand for credit services that LemFi Credit – LemFi’s first credit offering – has gained 8,000+ users just six weeks into its private beta, growing 18% week-on-week.
Customers receive a virtual card and physical Visa cards will launch later this year when the service is rolled out to the public.
These cards will leverage Pillar’s technology to recognise international credit histories, allowing immigrants to “import” their credit standing from their home countries.
They will also provide alternative credit assessment using non-traditional data points to evaluate creditworthiness and offer graduated credit building, starting with secured or limited-line products that grow with the customer.
“Through LemFi Credit, we already provide our existing customers with the ability to grow their credit right within the LemFi app,” said Ridwan Olalere, LemFi co-founder and CEO.
“With this acquisition, we plan to offer credit cards to customers, starting with the UK and roll out the full suite of LemFi Credit features publicly.
“Credit forms a critical part of our vision of building a full-stack financial service for immigrants everywhere, and Rian and I are particularly pleased that Adam and Ash have agreed to join us in building it.”
Bhatt added: “Despite earning a good salary at Barclays, I couldn’t access even the everyday products I’d had in India. I couldn’t get an iPhone, let alone a credit card.
“There have been slight improvements, but we still can’t offer equitable access to bank accounts or credit cards to someone from another country.
“I’m excited for the impact we will have together with LemFi to increase reach by 10x and build truly global access to credit.”