Mexico City-based firm Nelo has raised $3 million from a seed funding round to expand the use of the buy now pay later platform in Mexico.
The seed funding round was led by FinTech-focused venture capital enterprise Homebrew and also saw participation from Susa Ventures, Rogue Capital, Unpopular Ventures, Crossbeam and others. To date, Nelo has raised a total of $5.6 million in funding since its inception.
Established in 2019, Nelo is a start-up that is building the payment platform in Mexico. The company claims it is already live with more than 45 merchants and over 150,000 users. The firm has around 14 employees and houses an engineering team in New York.
Buy now, pay later is a way of consumers paying for purchases via instalment loans with little to no interest over a select period of time. The market has ballooned in popularity over recent years, growing especially in the US, Australia and Europe. Key players in the market include Afterpay, Affirm and Klarna.
Nelo launched its first product in Mexico in January last year. Later in 2020, the company launched credit instalment loans. Recently, Nelo launched its first product via an Android app and plans to launch a web app ‘soon’.
So far, Nelo has lent about $2 million and claims it is seeing growth of around 20% month-over-month.
Cash is still the dominant method of payment in Mexico, with 86% of all payments being cash-based. eMarketer claims the region was the fastest-growing e-commerce market worldwide during 2020, with 37% growth year-over-year.
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