Carrot Credit, a Nigerian fintech company, recently announced via LinkedIn that it has raised $4.2 million in seed funding to expand its lending platform, which enables users to borrow against digital investment assets.
The funding round was led by MaC Venture Capital, a firm that’s known for investing in diverse founders, as AFROTECH™ previously reported, with additional participation from Partech Africa and Authentic Ventures.
When making the announcement, Carrot Credit stated that the funding will be used to support the company’s efforts to grow its team, enhance its credit infrastructure, and strengthen integration with digital investment platforms across Africa.
Borrowing Without Selling: A New Credit Framework
According to its website, Carrot Credit offers a unique approach to lending by allowing individuals to use their financial assets, such as stocks, exchange-traded funds (ETFs), government bonds, or cryptocurrencies, as collateral.
Users can access up to 40% of the value of their steady stock portfolios or up to 70% of fixed-income assets, including government bonds, Tech Pression reports.
Rather than requiring asset liquidation or traditional credit scores, Carrot Credit’s platform connects directly to users’ investment accounts through APIs, according to the outlet.
Tech Pression also states that once holdings are verified, the platform places a lien on the assets while still allowing users to retain ownership. This system provides an alternative path to liquidity for investors who have historically been underserved by conventional lenders.
Flexible Lending Embedded In Africa’s Fintech Ecosystem
Carrot Credit’s flexible short-term and long-term loans include repayment periods ranging from three to 12 months, along with monthly installment plans, Tech Pression states.
Additionally, compared to other digital lending solutions in the market, Carrot Credit’s interest rates are competitively low, 3% for the first 30 days, with the remaining days leading up to the next due date prorated, according to its website.
Because Carrot Credit uses an embedded B2B2C business model, it integrates its services with digital wealth managers, brokerages, and fintech apps. This strategy enables easy borrowing within platforms that users already trust and expands credit availability for Africa’s quickly expanding population of digital investors.
Positioned For Growth In Africa’s Fintech Future
Since its inception, Carrot Credit has processed over $2 million in loans and serves more than 10,000 users, according to Tech Pression.
With fresh investor backing and a scalable model, the company is well-positioned to lead the next wave of credit innovation across Africa.
