Car finance Fintech Carmoola raises £103.5m to drive growth
UK car finance fintech Carmoola has raised a £8.5m Series A round and £95m debt facility to revolutionise the way people pay for car purchases.
The round was led by US-based fintech specialists QED Investors, with participation from existing investors VentureFriend and InMotion Ventures, the investment arm of Jaguar Land Rover. It also includes a debt facility provided by Natwest, priming Carmoola for rapid growth in a lucrative market worth £120bn in the UK alone.
Launched only ten months ago, Carmoola is liberating the archaic, slow, and backwards car finance market with a new, straightforward “neo car finance” product that is effortless to use and reduces the time taken to complete a car purchase from days to just minutes. Carmoola’s exclusive proprietary technology and systems enable a streamlined process that provides buyers with a budget, generates a free history check on the car, and allows payment to be made both instantly online and at the showroom within just 60 seconds using a Carmoola virtual card for a seamless consumer experience.
Carmoola CEO Aidan Rushby said: “Used-car finance couldn’t be more ready for a fintech revolution. Consumers want the freedom to go shopping anywhere, knowing what they can spend, without sending off reams of forms and payslips.
“Frustrated consumers are being put in a corner with excessive rates, manipulated commission, and poor customer service, but it’s the very process of getting finance that is at the heart of the problem. It’s full of paperwork, lengthy processes, and lack of certainty, but most importantly, car finance is obtained after the consumer has fallen in love with the car they want, which wholly puts them on the back foot. Until now, that is.”
With 7.5 million used car purchases being completed in the UK alone in 2022 – at an average price of £13,705, Carmoola is serving a £120bn market for pre-approved car finance.
Yusuf Özdalga, partner and head of Europe at QED Investors, the backer of finance unicorns Remitly and NuBank that led the round into Carmoola, said: “Having not adapted to modern expectations for the consumer, the car finance industry has been caught off guard by the new neo-car finance brand Carmoola, who champion the consumer at every part of the process. Carmoola is on track to dominate the car finance sector with a game-changing approach to purchasing.”
The funding will be immediately deployed to continue to scale the business and support the rapid customer adoption Carmoola has seen since launching just ten months ago. The plan is to grow the team to 20 people to meet demand, with the customer at the heart of their business. This championing of customer service and experience has earned Carmoola ratings at a minimum of 4.9 out of 5 across all review platforms.
Rushby added: “This funding will not only drive our ambitious growth aspirations but enable us to continue putting the customer at the forefront of everything we do.”
Carmoola will also be launching green discounts in the coming months, which aim to incentivise consumers to utilise more sustainable choices. Pure-electric cars rose by 57% to take a 1% share of the used market, which will become a continuing trend for Carmoola to capitalise on.
