[Funding alert] Progcap raises $5M from Sequoia India, CIBIL Chairman, Freecharge Co-founder, others
Delhi-based Progcap, which provides debt to small and micro businesses, secured $5 million as part of its Series A investment in a round led by Sequoia India. The round also saw participation from MV Nair, Chairman of CIBIL, Sandeep Tandon, former founder of Freecharge along with existing investors GrowX Ventures Fund and Somak Ghosh.
Founded in 2017 by Pallavi Shrivastava and Himanshu Chandra, Progcap provides access to fast and flexible collateral-free working capital to retailers in Tier-II, III, and IV areas, where retailers typically face challenges in accessing capital for their businesses.
Through its Last Mile Retailer Finance facility (LMRF) solution, the fintech company provides the under banked, semi-urban and rural retailers in India access to flexible, collateral-free working capital.
Over half of Progcap’s customers are new to the credit ecosystem. Its lending platform does risk assessment of these businesses using non-traditional ecosystem data, creating credit scores for customers currently left out by traditional financial institutions.
Pallavi Shrivastava and Himanshu Chandra, Co-Founders of Progcap
Speaking on the investment, Co-founder Pallavi Shrivastava, said,
“The capital infusion will help us strengthen our operations, build on our technological differentiation, and accelerate the pace of our pan-India expansion.
Pallavi has a background in development finance having worked for the likes of International Finance Corporation and the World Bank. Himanshu has spent over a decade in the financial services industry, working with institutions like Standard Chartered, Barclays, and the Carlyle Group.
Ashish Agrawal, Principal, Sequoia Capital India Advisors, added, ”India has multi-layered distribution chains where credit is an important enabler. Currently, only large distributors are able to get access to inventory financing through banks and other formal channels. With a well-designed product, Progcap is able to extend credit to smaller sub-dealers and retailers.”
The startup previously raised a capital investment of over $1 million in April 2019 from early-stage investment firms GrowX Ventures and Contrarian Drishti, as well as angel investors Somak Ghosh and Abhishek Dalmia.
(Edited by Saheli Sen Gupta)