Aye Finance raises $10 M debt funding from responsAbility, Northern Arc

By Tarush Bhalla|17th Jan 2019
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CapitalG-backed fintech startup Aye Finance on Thursday announced that it has raised $10 million in debt funding from global impact investment manager responsAbility and Northern Arc, through the issuance of Non-Convertible Debentures (NCDs). With the latest funding, Aye Finance is gearing up to bolster its lending portfolio and offer affordable business loans to a larger number of micro-enterprises in India.

In November last year, the firm had raised Rs 72 crore in debt funding from Swiss-based impact investor BlueOrchard Finance Ltd. At present, the MSME lender claims that until now it has disbursed over Rs 1,250 crore to over 1,00,000 customers.

Aye Finance
The AYE Finance team

Speaking on the fundraise, Sanjay Sharma, Managing Director of Aye Finance said,

“I believe the market need being addressed by us is very large, and having enabled the inclusion of over 100,000 micro entrepreneurs, we have established that our unique Cluster Based Credit Assessment methodology has the capability to scale up rapidly while delivering good value to our customers. And despite the bearish sentiments in the market, we have continued to get support from the industry in our mission to transform micro enterprise lending in India, as we continue to demonstrate robust metrics on growth and quality.”

In June, the Gurugram-based company had also raised $21.5 million as a part from its Series C funding led by CapitalG (formerly Google Capital). Existing investors SAIF Partners and LGT also participated in the round.

Dr Kshama Fernandes, Chief Executive Officer, Northern Arc Capital, said:

“The MSME sector is a key and crucial growth driver of the Indian economy, and a significant financing opportunity for specialised lenders like Aye Finance, that possess a deep understanding of the businesses it serves as well as their financing needs. Northern Arc’s association with Aye Finance goes back to over four years, during which time we have worked together on various domestic and offshore transactions with the sole aim of catalysing growth in this under-served and important sector. We are pleased to have partnered with responsAbility on this important transaction, and look forward to continuing to partner with Aye Finance on its exciting journey.”

Aye Finance was founded by Sanjay Sharma and Vikram Jetley in 2014, and operates through 104 branches spread across 11 northern, central and southern states. Along with enabling the micro businesses through its credit solutions, the lender is also empowering them through its digital book-keeping app and advisory services to help them run their businesses efficiently.

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