MUFG Bank, the core banking subsidiary of Mitsubishi UFJ Financial Group, has signed a joint venture agreement with Liquidity Capital, an Israeli fintech company, to launch a debt financing company for start-ups in Asia-Pacific region.
Under the terms of the agreement, MUFG Bank and Liquidity Capital are expected to form a joint venture company dubbed Mars Growth Capital in Singapore.
Mars Growth Capital is planned to create a debt fund, with an initial capital commitment of $80m, through a Limited Partnership agreement with MUFG Bank, as a limited partner, and Mars Growth Capital as a general partner. The fund will be used to finance start-ups.
The creation of Mars Growth Capital and the debt fund and the launch of the financing for business are expected to happen in 2020.
The JV will support Liquidity Capital’s business expansion, and MUFG’s growth commitment
The joint venture agreement is said to support the expansion of Liquidity Capital’s business, and MUFG’s commitment to growth in Asia Pacific, powered by the advanced digital technology.
MUFG, through its corporate venture capital Mitsubishi UFJ Innovation Partners, has previously invested in Liquidity Capital’s digital technology.
Liquidity Capital is a start-up that leverages advanced credit scoring model based on AI technology, real-time financial and accounting data from client bank accounts, accounting systems and CRM information gathered through its API technology to estimate the future earnings and cash flow.
MUFG Bank stated: “With the changes in individuals’ preference to remote communications accelerated by COVID-19, it is expected that the market for the tech industry will grow, with even more new startups arising.
“With this joint venture, Liquidity Capital and MUFG Bank will not only promote financial inclusion and innovation in Asia Pacific, but also contribute to the sustainable development of society by helping businesses and communities adapt to and overcome the current crisis.”
