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London-based fintech Updraft raises £16M to make your credit card redundant

Updraft

Credit cards, which can be used for shopping, paying bills, and food are a good option only if you are comfortable paying your credit card bills at the month-end. If you are finding it difficult, it’s time to pause and rethink your spendings, else, a single card can make your life hell. 

In this dynamic and busy lifestyle, we find it difficult to keep a track of our expenses. There are personal finance apps, to track and save but getting good financial advice remains difficult. This is where Updraft stands out from the crowd.

Secured £16 million funding

Based out of London, Updraft, a part lending, part credit report, and part financial planning app is designed to tackle escalating consumer borrowing. Recently, the company secured £16 million in funding to help its members avoid unnecessary credit card and overdraft charges. 

Investors

The funding arrives in the form of equity and debt, with specialist investment firm Quilam Capital leading on the debt side, and the UK Government’s Future Fund participating via their convertible loan note alongside a group of high-net-worth investors.

Turns borrowers into savers

Available on App Store (iPhone), Updraft turns borrowers into savers by automating the day to day decisions involved in managing money and mainstream borrowings. Founded by financial services executive Aseem Munshi, Updraft is going after the lending market, but in a unique approach.  

The company wants to help customers get rid of spend-linked borrowings such as credit cards, overdrafts and increasingly, the buy now pays later schemes often found on e-commerce sites. 

Updraft uses open banking and credit report data to build a 360-degree picture of a user’s spending and borrowing and provides a series of interventions designed to lift the consumer back into the black. 

Where expensive borrowing is detected, users can get ‘Updraft Credit’ to pay off these high-interest-rate debts with a lower-cost loan, potentially saving them thousands of pounds in charges.

Uses human interaction too

Unlike other personal finance apps, Updraft uses the combination of algorithms and human interactions to give members bespoke recommendations on how to pay off borrowings in the quickest amount of time and how to go about building savings.

More than forty thousand people joined the waitlist for the FCA approved service and 15 thousand were granted early access to beta test Updraft throughout 2020 before it hit the App Store last week. 

Confirming Quilam Capital’s investment, Director Sarah Watts says, “Over the years we’ve seen innovators making use of open banking, shed light on financial health, and provide credit, however, Updraft provides a truly unique offering across all of these aspects with a market-leading solution to give customers the fairly priced credit they deserve. We’re delighted to invest in Updraft and support the business on their mission to give consumers the tools to save and reach their life goals faster.”

CEO Aseem Munshi comments: “We are thrilled by this vote of confidence from a respected institution like Quilam. This funding gives us the firepower to take on the UK’s spiraling consumer borrowing.”

Updraft is available now on iPhone via the Apple App Store, with the Android version soon to follow.