India-headquartered Klub has recently gained regulatory approval from Abu Dhabi Global Markets (ADGM), making them the first revenue based financing (RBF)-focused credit fund to expand in the Middle East region. Investopedia defines RBF as “a method of raising capital for a business from investors who receive a percentage of the enterprise’s ongoing gross revenues in exchange for the money they invested.”
According to a press release, the company has received a Category 3C license to manage private credit funds. This is under the credit fund regime by the ADGM’s Financial Services Regulatory Authority (FSRA).
Klub is India’s biggest RBF platform and has already deployed over AED400 million in 1,600 investment rounds. This has helped more than 600 digital businesses grow.
AED1 billion credit umbrella
As Klub expands into the Middle East, the RBF platform will create a credit umbrella worth AED1 billion. In particular, this focus on credit products to support the development of SMEs and startups within the region.
“As a company, we have consistently embraced the mission of driving growth for local businesses. Our expansion to the Middle East, starting with the UAE, is the first step in this direction,” remarked Anurakt Jain. He is the co-founder and chief executive officer of Klub.
“Sixty percent of the region’s GDP is driven by SMEs which are starved for fast and flexible financing solutions. Klub will bridge this gap,” he added.
Moreover, Co-Founder and Chief Operating Officer Ishita Verma said, “We’re thrilled to bring our technology and e-commerce financing expertise to a new region in the Middle East, contributing to its entrepreneurial ecosystem.”
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Innovative financing
In the United Arab Emirates (UAE), ADGM is at the forefront of fostering financial innovation and collaboration. Specifically, the international financial center (IFC) of the UAE’s capital city, Abu Dhabi, takes pride in its robust regulatory environment.
By granting Klub a license, ADGM has increased its ability to support investments and provide financial expertise to new businesses in the Gulf Cooperation Council (GCC) and beyond.
Klub’s advanced technology platform provides a fast, completely online process for getting flexible loans for digital SMEs. Subsequently, this makes it easier for such businesses to access innovative AI-enabled financing solutions. This license also lets Klub collaborate with regulated banks in the Middle East.
Welcoming Klub to ADGM, Chief of Market Development Arvind Ramamurthy shared, “[We are] confident that ADGM’s dynamic ecosystem and progressive credit fund regime will reinforce Klub’s proven track record as a leading revenue based financing player in India.”
“Their commitment to financial innovation is aligned with ADGM’s vision and we look forward to providing the best platform that supports them in developing their offering and efficiently contributing to the continuous development of Abu Dhabi’s vibrant financial landscape and its strategic value to global finance,” added the ADGM executive.
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