Kargo has announced that it has inked an SME financing agreement with Yoma Bank, Myanmar’s largest commercial bank. Under the agreement, Kargo will receive an initial loan of approximately US$130,000. Through the bank’s Unsecured SME Financing, Kargo is now able to facilitate same-day payments to its truck drivers, boost its ability to further grow its customer base and manage all invoices.
Founded in 2016, Kargo is Myanmar’s leading and fastest-growing logistics and supply chain startup. Its service easily connects independent truck drivers, fleet owners, third-party logistics (3PL) companies and commercial logistics providers directly with businesses that require reliable, trackable distribution and delivery of their goods across the country. Since its establishment in 2016, the company has connected almost 2,000 truck drivers in Myanmar.
“When we first envisioned Kargo, we were starting out in an extremely fragmented market that had a very opaque pricing system,” said Alex Wicks, the Founder and CEO of Kargo. “We have since made great strides in growing our driver network to nearly 2,000 independent truck drivers, fleet owners, 3PLs and commercial trucking companies – making our virtual fleet the largest in Myanmar and completing over 5,000 deliveries to date.”
“With Yoma Bank’s support we will be able to fuel our expansion, business growth and our drivers’ income; as we seek to realise our vision to provide quality trucking logistics solutions that are priced fairly for both the consumers and drivers,” he added.
Initially financed by Wicks, Kargo has continued to roll out its business with capital injected by angel investors and venture capital firms – such as Singapore-based SEED Myanmar during a seed round in 2017. The company also received a six-figure grant in February 2018 which the company has used to sustain the its rapid expansion.
Upon winning the Startup SG prize and winning the ‘Best Logistics and Supply Chain Startup’ at the Echelon Top 100 Start-up Competition, Kargo received a US$50,000 from the Singapore government. This was followed by the launch of Kargo’s Pre-Series A funding round to help fuel its growth in Myanmar. This move resulted in the firm raking in a seven-figure sum raised from Singapore’s ‘Cocoon Capital’ and another private venture capital firm.
Yoma Bank’s Unsecured SME Financing signifies the bank’s focus on supporting the growth of Myanmar’s SMEs; which typically faces the problem of cash flow management. Kargo is the first company that Yoma Bank has offered this loan to since the Central Bank of Myanmar approved the disbursement of unsecured lending.
“At Yoma Bank, we are committed to finding innovative ways of supporting Myanmar’s SMEs”, said the CEO of Yoma Bank, Hal Bosher. “Unsecured financing is solely based on the cash flow of the business and is a progressive way of supporting smaller enterprises. This financing is the first of many and we look forward to seeing innovative and tech-driven SMEs such as Kargo thrive in this market.”