• Debt Funds as an alternative financing option in the Coronavirus crisis: a ray of hope for young FinTechs?

    14 July 2020

    Young FinTechs are currently faced with the - sometimes existential - question of how to obtain sufficient funding (at acceptable conditions) to bridge financial bottlenecks or further develop their own business model. As they often do not yet generate profits and are rarely able to offer relevant loan collateral, such start-ups are often not eligible for either governmental emergency loans or standard bank loans. However, even if FinTechs receive loans in the current Coronavirus crisis, the rigid conditions attached are a heavy burden in the long term. This can have a significant impact on young companies’ economic flexibility and innovation.
    A financing option which has not been around for so long (in Germany) could become more attractive in the future: alternative investment funds ("AIF") which - outside the banking sector - grant loans to FinTechs.