Pesto, a provider of collateralized credit cards, raised USD 11 million in a funding round, with participation from Activant Capital, Plural, and Sozo Ventures, among others. It aims to use the fresh funds to expand its customer base throughout the US, initially emphasizing the two cities, Atlanta and Los Angeles.

Alongside the fundraising, the company also introduced its first product, a collateralized credit card. Customers provide their assets as collateral to Pesto and credit cards are issued to them based on the value of these assets. This enables individuals with poor credit histories to obtain credit cards and improve their credit scores.

The company reports charging similar interest rates to existing credit cards and claims that these rates are lower than what pawn and payday loan clients typically pay.

Founded in 2020, Pesto offers its credit cards in partnership with Continental Bank. Customers can apply and submit their assets for approval and check the status of their applications from the company’s online portal.