Gurugram-based CoinTribe, a credit-based lending marketplace for MSMEs, on Friday announced that it has raised over $10 million equity capital in Series-B round led by Sabre Partners along with participation from existing investor, Puneet Dalmia.
As a credit-based marketplace, CoinTribe offers unsecured term as well as working capital financing to small businesses, which are risk assessed using an online lending algorithm.
The company claims to be India’s only marketplace which has back-tested its credit algorithm with leading private banks in the country and has so far partnered with leading banks and NBFCs, which include Axis Bank, Yes Bank, RBL Bank, DBS, IIFL, Clix Capital, and SMC Capital.
With this round of funding, the total equity capital raised by CoinTribe has increased to over $ 15 million. CoinTribe plans to use this additional capital to further enhance capabilities of its proprietary online credit algorithm, expand to new markets and further develop technology to enable faster and nimble product and credit model innovation.
Amit Sachdev, Co-founder and CEO said, “We welcome Sabre Partners and look forward to partnering with them in our new wave of growth. At CoinTribe, we have developed a differentiated business model with strong focus on low capital and low risk, positive unit economics and capabilities in credit and technology. Our model has been well-recognised by leading financial institutions, who have chosen to partner with us after due diligence of our capabilities. We remain committed to our partners and this funding will help us further strengthen and scale up our marketplace operations. Going forward, we will benefit significantly from Sabre Partners’ rich experience and knowledge of the financial services space.”
Speaking on the transaction, Rajiv Maliwal, founder and managing partner, Sabre Partners said, “We are extremely excited to partner with CoinTribe in its journey. CoinTribe has evolved as a truly differentiated online MSME marketplace over the last couple of years and demonstrated strong credit-tech capabilities, traction from leading financial institutions and a robust business performance. Given solid foundations laid for the business and a strong management team, CoinTribe is well placed to emerge as a leader in the $800 billion MSME lending market in India.”
Speaking on the transaction, Puneet Dalmia, MD Dalmia Bharat Cement Limited and existing investor in CoinTribe said “CoinTribe is solving a key problem that would enable MSMEs to grow at a much faster rate in future and play a meaningful role in nation building. Lack of easier access to efficient capital has been a big deterrent for MSMEs in last several decades, for which data driven risk assessment algorithms provide an elegant, efficient and scalable solution. Given its capital light and risk light model and strong credit-tech capabilities, CoinTribe is well positioned to catalyse MSME lending transformation in India.”
According to the International Finance Report, only five per cent of the 26 million registered MSME units have access to traditional sources of funding and in total there is a 450 billion dollar gap in the market for this sector.
SME financing has traditionally been limited to businesses that have solid financial credentials or assets to back the loan. However, startups like IndiaLends, LendingKart, Faircent, Capital Float are making it easier for SMEs to receive loans by leveraging technology and alternate data sources to underwrite.