[Funding alert] Trade finance startup Vayana Network closes Series C at Rs 397 Cr

Trade finance startup Vayana Network on Wednesday said it has raised Rs 114 crore from International Finance Corporation (IFC) and Prosus-owned PayU in its Series C round, in addition to the Rs 283 crore it had raised as part of the round earlier.

New and existing investors such as Chiratae Ventures, March Capital, Marshall Wace, CDC Group, Jungle Ventures, and family offices in India and abroad were some others that participated in Vayana's Series C round.

Founded in 2017 by Ram Iyer, Vayana is a B2B trade financial intermediary that connects SMEs and corporates with financial institutions for low-cost access to trade loans. The company claims to have facilitated $10 billion in loans to date, and processed over two million transactions.

"While we are set to do more than $10 billion of trade financing in India alone this financial year, we are focusing on creating tools and infrastructure to help small businesses manage their working capital efficiently and sourcing trade finance at the most affordable rates," Ram said in a press release announcing the fundraise.

"FY23 also will see the launch of Vayana ITFS (International Trade Finance Services) platform at GIFT City (Gujarat), which will enable exporters and importers access international trade finance facilities at competitive rates," he added.

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The Pune-based startup said it will use the fresh capital infusion to build more products focused on helping SMEs and MSMEs manage their working capital better and become credit-ready.

Citing a World Bank report, Vayana says MSMEs in India face a $380 billion credit gap, providing ample opportunity for the startup to grow and thrive.

A number of startups looking to bridge this credit gap have cropped up over the last couple of years, including the likes of Indifi, Lendingkart, Kinara Capital, and FlexiLoans.

"The collaboration between both companies will lead to multiple synergies with PayU's merchant ecosystem, especially the SME transaction platform and SME lending portfolio. This investment is aligned with our ambition to capture the broader India SME credit opportunity," said Vijay Agicha, global head of strategy and growth at PayU.