Maersk’s growing ambitions in the realms of trade finance have seen the Danish carrier invest in a German startup.
Financing platform Modifi raised EUR5.5m in its second round of capital raising with Maersk Growth, the corporate venture arm of A.P. Moller-Maersk, as the lead investor.
The Modifi (Modern Digital Finance) platform was founded in November last year by three Germans who had previously been involved in Billpay, a service provider for the settlement of bill payments, bought two years ago by the Swedish payment service provider Klarna.
Using Modifi, traders can pre-finance individual orders worth between EUR5,000 and EUR75,000. The service is aimed at small and medium-sized companies that buy goods abroad.
“Maersk’s investment is an accolade for our mission to digitise trade finance,” CEO Nelson Holzner told German media yesterday. “We believe this partnership offers many opportunities to collaborate beyond just funding.”
Modifi said the new investment would see the platform target India for business, a nation Maersk has also been focusing on in its nascent trade finance initiatives.
On the Modifi website, it states that small and medium sized businesses (SMEs) contribute around 30% of volumes of world trade. Finance is usually required to facilitate these trades, but banks reject more than 50% of SME trade finance requests, according to Modifi. This has resulted in a funding gap of $1.5trn.
Three years ago Maersk moved into the trade finance arena offering import and export financing as well as structured finance solutions to small and medium-sized enterprises in selected countries around the world.