Liberis, a pioneer in embedded business finance solutions, announced it has secured $112 million in debt financing to support its further growth in North America and Europe and expansion into new markets, including Canada and Germany. This strategic collaboration is set to inject a substantial sum of $112 million from HSBC Innovation Banking and BCI Capital across its European and North American divisions.

The additional debt capital marks another 2023 milestone for Liberis as it enables the company to broaden its reach and bolster its mission to close the global small business funding gap. This funding strengthens Liberis’s commitment to providing businesses with more adaptable and accessible financial options, particularly during a time when the pressures on margins for small businesses from high inflation, difficulty in finding staff and the reduction in consumer spend as well as slowing economic growth as predicted by the International Monetary Fund.

Rob Straathof, CEO of Liberis, commented on the new financing: “The joint debt facility from HSBC Innovation Banking and BCI Capital allows Liberis to serve thousands more business owners with fair and frictionless funding through our partners using our embedded finance platform. It enables us to extend our reach into new markets like Canada, Poland, and Germany. We are thrilled to be supported by our capital partners as we continue to serve businesses with innovative and flexible funding solutions.”

Guillaume Adjogah, SVP – Fintech Warehouse Finance at HSBC Innovation Banking UK said: “We’re delighted to provide this new facility, which will enable Liberis to further spread its wings into new geographies. At HSBC Innovation Banking, we have the agility, international expertise and robust network required to power bold innovators across all growth stages. This is an exciting milestone in our long-term partnership with Liberis and we’re proud to be part of this next step in the company’s journey.”

Sam Kemp, CEO of BCI Capital, added: “SMEs are the engine room of the global economy, representing around 90% of businesses and more than 50% of employment worldwide2. Liberis has become a central cog in this system, with its innovative solution providing the vital funding that SMEs need to grow and thrive. Having been partnered with the business since 2015, we are delighted to be evolving our support for Liberis as it looks to further broaden its reach on the world stage.”

The funding will support Liberis’s strategic plans to serve existing and new partners in these new territories, enabling the company to address the unique needs of SMEs by offering tailored finance options that align with their growth trajectories.

Liberis is a pioneer in using AI and machine learning-powered analytics to power its embedded finance platform, providing personalised flexible finance solutions to small businesses. Through its global partners such as payment acquirers, neobanks, e-commerce platforms and financial institutions, Liberis has funded over $1.5 billion in over 60,000 transactions.

The total funding secured by Liberis from capital providers as well as investors reaches over $700m to date. Its equity backers include Barclays, Blenheim Chalcot, and FTV Capital. Together with the debt financing support from HSBC Innovation Banking and BCI Capital, Liberis is set to continue its trajectory of empowering SME owners with the financial tools they need to succeed in an increasingly challenging economic landscape.

A $5.2 trillion funding gap

Small businesses across the world face a common existential threat: limited access to responsible and sustainable finance. This financial exclusion is caused by several crippling factors – from being underserved by legacy providers to low levels of financial literacy.

According to the World Trade Organisation, small businesses make up over 90% of businesses and 60-70% of employment worldwide. Despite the vital role they play in economies globally, the financing gap for small businesses is substantial, with an estimated $5.2 trillion in unmet financing needs each year.

Commenting on the funding gap faced by small businesses, Nima Montazeri, CPO at Liberis, said: “The challenge faced by small businesses when seeking finance is indicative of the inflexible lending criteria maintained by traditional banks, which often unfairly categorise SMEs as high-risk borrowers. This issue stems from outdated lending practices and technologies which fail to adequately cater to the needs of smaller, asset-light businesses.”

“By deploying advanced AI and ML algorithms and leveraging a large data pool built over more than a decade in the business, Liberis is able to offer SMEs innovative and highly personalised products that meet their needs for sustainable growth, no matter where in the world they’re based,” he continued.