A U.S.-based lender that targets borrowers in developing nations where credit scores are often hard to come by has raised $50 million in new equity funding.

Tala, based in Santa Monica, Calif., plans to use the latest round of funding to develop new products for its customers in Kenya, Tanzania, the Philippines, India and Mexico.

It also raised $15 million in debt capital that it will use to fund loans.

“We know that there is a lot of volatility in our customers’ lives,” said Tala CEO Shivani Siroya.

Residents of countries where Tala operates can apply for loans of between $10 and $500 through the company’s mobile app, even if they have little or no credit history. If they are approved, they typically receive the money in minutes.

CEO Shivani Siroya said in an interview Monday that Tala plans to develop new products to help its customers deal with financial shocks and emergencies. “We know that there is a lot of volatility in our customers’ lives,” she said.

Tala, founded in 2011, has made more than 6 million loans since its inception. The company was making loans only in Kenya until last year, when it added four new countries.

Most of Tala’s borrowers are business owners who use the funds for working capital purchases, though consumers are also eligible to apply.

In an interview early last year, Siroya touted Tala’s ability to use data that it takes from its customers’ mobile phones in order to evaluate the likelihood that they will repay their loans. For example, she said that people who typically type in only one name when they save a contact in their phones are less likely to be good borrowers.

At the time, Siroya said that Tala saw an opportunity in developing countries in part because they tend to have less-stringent rules about the use of consumer data than wealthier parts of the globe do.

On Monday, Siroya said that Tala has since revised its approach to evaluating loan applicants, and currently relies less heavily on data that it mines from its customers’ phones than it previously did. The changes come at a time of rising concern about the ways in which internet firms are using consumer data.

“What we’ve said is that we know there are certain features that can create an explicit bias,” Siroya said. “We’re willing to actually leave money on the table to stand for something that is a lot more equitable and a lot more fair.”

She said that Tala is now leaning more heavily on behavioral data, such as how quickly prospective borrowers fill out a loan application. “You want to know that this person is not fraudulent,” she said.

More than nine of 10 loans made by Tala get repaid, according to Siroya. She said that more than half of all prospective borrowers are getting approved, and added that the company believes it can increase its approval rate to above 80%.

Tala’s latest funding round was led by Revolution Growth, a venture capital firm whose chief executive is AOL co-founder Steve Case. In addition to $50 million in equity funding, Tala also raised $15 million in debt capital to fund loans.

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Kevin Wack

Kevin Wack

Kevin Wack is a California-based reporter for American Banker who covers the U.S. consumer finance industry.