Home News Deals and Investment SA Fintech Startup Planet42 Raises $2.4m to Increase Access to Mobility

SA Fintech Startup Planet42 Raises $2.4m to Increase Access to Mobility

  • The South African Fintech startup Planet42, which offers its underbanked clientele, easy access to a personal car, has raised US$ 2.4 million in funding to help it continue to scale.
  • The US$ 2.4 million seed round was led by Change Ventures, with private sponsors including Martin Villig of Bolt, Ragnar Sass of Pipedrive and several other Estonian tech entrepreneurs.
  • Planet42 aims to use the funds to facilitate the expansion of its vehicle portfolio. The start-up is targeting a total of 100,000 cars in South Africa alone by 2024,

The South African Fintech startup Planet42, which aims to deliver mobility access to underbanked, has raised US$ 2.4 million in funding to help it continue to scale.

Initially launched as CarGet in 2017, Planet42 partners with dealerships across South Africa are offering access to a personal car to its largely underbanked customer base.

The startup utilizes an automated score algorithm to process client applications based on credit bureau, affordability, and alternative data. If an application is approved, Planet42 analyses the validation documents of the customer before buying a vehicle from the dealership and renting it to the customer. The asset is secured by tracking technology as well as comprehensive and mechanical insurance.

Almost 2,000 vehicles have so far been shipped to customers, with Planet42 experiencing an eight-fold expansion in 2019, and funding has now been raised to help expand further. The US$ 2.4 million seed round was led by Change Ventures, with private sponsors including Martin Villig of Bolt, Ragnar Sass of Pipedrive, Marko Virkebau of MeetFrank, Kristjan Vilosius of Katana MRP and several other Estonian tech entrepreneurs.

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Planet42 plans to channel the funds raised towards expanding its vehicle portfolio. By 2024, the start-up is targeting a total of 100,000 cars in South Africa alone.

“Having a personal vehicle is a necessity in South Africa, as public transport is underdeveloped while ride-hailing is prohibitively expensive for most. A family car can be a lifesaver, but banks focus on newer, expensive vehicles and only approve 15 per cent of car financing applicants. This leaves few alternatives to lower- and middle-income households,” said Eerik Oja, co-founder and chief executive officer (CEO) of Planet42.

“We see a huge need for people to improve their standards of living with better mobility, but a lack of options in the market to service them. More than 24 million people are credit impaired or have no access to finance in South Africa – that’s well over half of the adult population.”

The startup is also looking at international expansion across key emerging markets, where it will be offering motorcycles and other types of mobility, alongside cars.

“We want to help people across the world commute with ease, earn more and feel secure. No one deserves to be deprived of the opportunities something as basic as a personal vehicle brings,” said Oja.

Rait Ojasaar, partner at Change Ventures, said his company recognised the global potential of Planet42 solution.

“There are multiple markets in Latin America, Africa and South-East Asia with similar pain points – poor public transport, limited access to credit, and long commutes. Fintech has the potential to make a huge positive impact on how people get from A to B in these places, and we are proud to back Planet42 in making it a reality,” he said.

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