Last week, the Nigerian fintech successfully raised $4.2 million in a funding round. It plans to use the funds to accelerate its growth in Africa and develop its technology.

Carrot Credit, a Nigerian fintech startup founded in 2023 by Boluwatife Aiki-Raji, is enabling individuals and businesses to secure online loans using their digital investments as collateral. The platform offers a novel solution for those holding financial assets who might otherwise struggle to obtain traditional credit.

Carrot Credit allows users to borrow up to 40% of the value of their equity investments, including non-fungible tokens (NFTs) and cryptocurrencies, or up to 70% of their fixed-income assets, such as government bonds. This approach allows borrowers to access liquidity without having to sell their underlying investments.

The startup secures these loans by placing a lien on the digital assets through API integrations. This ensures that while Carrot Credit holds a claim, borrowers retain ownership of their investments. The repayment terms are flexible, offering fixed durations of 3, 6, or 12 months, or adjustable monthly payment options.

Carrot Credit's interest rates are designed to be competitive, providing an appealing alternative to existing credit options in the Nigerian market. The company operates on an integrated business-to-business-to-customer (B2B2C) model, forging partnerships with fintech platforms, brokers, and digital wealth managers across Africa. This strategy aims to broaden credit access and embed Carrot Credit's services directly into the financial routines of digitally-savvy consumers.

The fintech firm reports disbursing over $2 million in loans to more than 10,000 users so far. With its innovative model, Carrot Credit seeks to make credit more inclusive and better aligned with the digital investment habits of a new generation of African consumers.

"Access to credit shouldn’t be limited by geography or legacy infrastructure," said Boluwatife Aiki-Raji. "People in Nigeria and across Africa are already investing in digital assets –but there’s no ecosystem to help them unlock liquidity when it matters. Carrot is building that bridge, helping users leverage their investments and take cash out when they need liquidity the most."

By Adoni Conrad Quenum,

Editing by Feriol Bewa