[Funding alert] NBFC Credit Wise Capital raises $6M in seed round

NBFC Credit Wise Capital will use the funding to grow its dealer network, geographically expand, and improve its technology and underwriting models.

[Funding alert] NBFC Credit Wise Capital raises $6M in seed round

Tuesday October 06, 2020,

2 min Read

Tech-enabled consumer finance NBFC, Credit Wise Capital (CWC) has raised $6 million in its seed round. The investment round was led by Chairman of MJ Shah Group Mayank Shah.

Family offices and angel investors including serial investor Ajay Goel, Founder of Venture Catalysts Anuj Golecha, Director of EssGee Group Gaurav Gandhi, Director of Shanti Group Anup Agarwal, and Gaurav Singhvi also participated in the round.

According to the company, CWC will be using the freshly raised funds to grow its dealer network, geographically expand, and improve its collection technology and underwriting models.

In a statement issued by the company, Mayank Shah said, "The razor-sharp focus on cost reduction to achieve scalability in this business was one of the primary reasons for our investment in Credit Wise Capital."

Hirak Joshi and Aalesh Avlani (L-R), Co-founders of Credit Wise Capital

Founded by Hirak Joshi and Aalesh Avlani, CWC aims to disrupt the two-wheeler lending ecosystem by combining traditional lending with fintech data science.

Co-founder Hirak Joshi said, "Many lenders progressed fast thinking that tech would handle risk on its own. They forgot that technology is as good as the hands that are put into use. Tech is an enabler and not a panacea for all the ailments. Technology cannot convert a delinquent customer into a good one."

CWC is serviceable in Mumbai and Pune and has a dealer network of over 100. The company has so far disbursed around 12,000 two-wheelers in the last 16 months, with average ticket size of Rs 65,000. It has onboarded debt partners including AU Small Finance Bank, Hinduja Leyland Finance, and Vivriti Capital.

Credit Wise Capital follows two approaches for its loan origination strategy — traditional dealer-driven approach and inbound approach.

Customers are further divided into three categories — fast track, income proof, and no income proof. Using its proprietary tool and taking more than 35 parameters into consideration, CWC makes a decision on whether to disburse the loan to a particular consumer.

Edited by Saheli Sen Gupta