German fintech Monedo files for bankruptcy due to pandemic

The impact from the coronavirus was so severe for Monedo, a well-known German fintech startup, the company was force to file bankruptcy.

Dr. Christoph Morgen, a lawyer at the Hamburg law firm of Brinkmann & Partner will handle the bankruptcy proceedings, according to a report in Finance Magnates.

The fintech was established in 2012, under the name of Kreditech, and offered microcredit loans to customers in and outside of Europe. It could not, however, offer its services to German customers.

Spain and Poland made up the biggest customer base, however the company still struggled before rebranded itself as Monedo this year and changing its strategy to focus on the algorithm to grant loans.

Monedo was heavily backed by popular tech investors, including billionaire, Peter Thiel, bank investor JC Flowers, and media giant Naspers.

Notably, the valuation of the fintech deflated from €200 million (around $237 million) to zero after it was revealed that the company handed out credits to private individuals in India and Russia that turned into default.

A spokesperson for Monedo claims that the company plans to continue operations and its already begun talking with possible financiers.