Fintech
Q2 202417.06.2024

Digital lending (Q2 2024)

Picture of Shubham Jaipuria

Shubham Jaipuria

at Sifted

After a stellar 2019 in which digital lending startups across Europe secured $2.4bn in funding, the sector has struggled to replicate that success. Although 2021 and 2022 were relatively positive, with startups raising $1.7bn and $1.4bn respectively, 2023 saw a significant decline, with only $326m raised. As of May 2024, digital lending startups have only garnered $181mn in funding this year.

With the advent of AI, startups are expected to offer automated pre-approval and risk assessment services. As SMEs and individuals turn to these lending alternatives, digital lending startups can enhance fintech’s reach to the underbanked and underrepresented. Moreover, with the push for a cleaner and greener Europe, digital lending and embedded finance solutions could accelerate the adoption of renewable energy.

Swedish startup Cloover’s $114m Series A last month, which saw participation from existing investors QED, Broadhaven Ventures and 9900 Capital as well as new investor Lowercarbon Capital, has been the only significant raise the sector has witnessed this year. The startup provides embedded financing options for solar panels, battery storage, heat pumps and EV charging systems. While the sector has experienced a subdued year, this aligns with the decline in fintech funding since its peak in 2021.

However, at the seed and Series A stages, fintech appears to be recovering. It was the top-funded sector in the continent last month. Therefore, expect improvements in the next 12-18 months.

20 startups to watch

  • Flowpay logo

    Sifted score

    7.3
    -

    Flowpay

    • Serial founder(s)

    • Year founded

      2020

    • HQ

      Prague, Czech Republic

    • Latest round

      Seed
      €2.1m / Mar 2024

    • Total funding

      €7.8m

    View company profile
  • Carmoola logo

    Sifted score

    6.61
    -

    Carmoola

    • Strong investor(s)

    • Year founded

      2021

    • HQ

      London, United Kingdom

    • Latest round

      Early VC
      €18.6m / Jan 2024

    • Total funding

      €64.2m

    View company profile
  • Income logo

    Sifted score

    6.43
    -

    Income

    • Strong investor(s)
    • Serial founder(s)

    • Year founded

      2020

    • HQ

      Tallinn, Estonia

    • Latest round

      Seed
      €1.3m / Mar 2022

    • Total funding

      €4m

    View company profile
  • BridgeFund logo

    Sifted score

    6.32
    -

    BridgeFund

    • Hiring

    • Year founded

      2018

    • HQ

      Amsterdam, Netherlands

    • Latest round

      Early VC
      €20m / Oct 2021

    • Total funding

      €21m

    View company profile
  • Jeff logo

    Sifted score

    5.81
    -

    Jeff

    • Hiring

    • Year founded

      2019

    • HQ

      Riga, Latvia

    • Latest round

      Seed
      €1.9m / Nov 2023

    • Total funding

      €4.3m

    View company profile

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