On Thursday, financial services startup IndiaLends.com announced raising $4 million in Series-A funding from American Express Ventures, with existing investors DSG Consumer Partners, Chinese investment firm Cyber Carrier VC and AdvantEdge Partners participating in the round.
The latest round of funding will be used by the company to expand its credit underwriting and analytics capabilities, offer more consumer-focussed products and increase its market footprint across India.
Started in March 2015 by ex-Capital One duo Gaurav Chopra and Mayank Kachhwaha, IndiaLends is a credit-scoring and analytics platform focussed on disrupting the fragmented consumer lending market in the country.
Operating as an online marketplace, it allows customers to shop for loan products, as well as offers credit scores and financial education. Attracting over 1,40,000 visitors every month, at present the platform helps these visitors get quick access to cheaper credit.
Further, it also looks to provide credit-scoring solutions to financial institutions to help them increase their lending footprint.
Speaking about their investment, Rohit Bodas, Partner at American Express Ventures, says,
“IndiaLends’ platform is helping to connect lenders and borrowers in India more efficiently by providing a user-friendly experience for consumers and leveraging a broader set of data than has traditionally been available to financial institutions in the market.”
Co-founder Gaurav claims that in the past one year, the firm has seen strong traction in their loan volumes, growing at 100 percent quarter-on-quarter. He adds,
We have partnered with over 30 banks and Non-Banking Financial Companies (NBFCs) and now offer bespoke lending products in segments that have been historically underserved. The superior quality and quantity of data is helping financial institutions underwrite more and more of our customers. This new round of funding not only gives us the capital to scale exponentially but also provides us access to resources and learnings from developed fintech markets such as the US and China.
The founders also claim that the last one year also saw the company make significant improvements to their data, analytics and technology capabilities, through a team of over 100 data scientists, technologists, marketers, and customer reps. The company has recently introduced products like credit-builder loans for first-time borrowers, in partnership with select banks and NBFCs.
The company has also attracted interest from global institutional investors, including China’s Cyber Carrier VC. Jessica Wong, Managing Director, Cyber Carrier VC, says,
“We are committed to working with entrepreneurs that are solving some of the toughest problems in consumer finance, such as inadequate access to financial products, low financial literacy and poor lending processes. We are thrilled to partner with IndiaLends, which has extensive experience in consumer finance, tech, and data science and can lead the fintech revolution, aimed at overcoming these challenges worldwide.”
IndiaLends was previously funded by DSG Consumer Partners and individual investors Siddharth Parekh and Gautham Radhakrishnan in October last year. Deepak Shahdadpuri, Managing Director, DSG Consumer Partners, says,
“The company’s track record and strong financial and business fundamentals, along with its team’s ability to create products that have high product-market fit has increased our faith in IndiaLend’s vision and execution capabilities.”
IndiaLends will continue to strengthen its proposition for customers and financial institutions by investing in its superior data analytics capabilities, which allow it to better assess customer segments that currently do not meet traditional scoring parameters.
IndiaLends goes head on with multiple other startups in the space. To give an example, there is BankBazaar that raised $60 million as a part of its Series-C round last July.
The company has been working actively on global markets like Singapore to drive growth and expansion.
However, IndiaLends seem to be going towards a holistic approach, including even credit-scoring capabilities, with other startups already tracking this space.
According to YourStory Research, payments and lending are two categories that have been top sellers in the fintech space. Over the past two years, there have been 23 payment companies (including mobile payments) and 26 lending firms (as of July 2016) that have been invested with more than a billion dollars in funding.
The lending space alone received $196 millon dollars in funding, and this amount set to grow in the near future.