Lendingkart’s Founder On Balancing Growth, Regulation And Public Market Expectations

Capital is the fuel to accelerate a business. But for India’s 63 Mn micro, small and medium enterprises, which accounted for 45.73% of total exports in FY24, securing collateral-free business loans remains a major hurdle, slowing their growth and competitiveness. Fortunately, India’s ongoing fintech revolution and new-age startups have risen to the occasion to plug this credit gap. Among them is Lendingkart, a digital-only MSME lending platform set up by Harshvardhan Lunia, a banker-turned-entrepreneur.Despite the setback, its assets under management (AUM) stood at INR 7,127 Cr as of March 2024, signalling the company’s continued focus on long-term growth.In sum, the company is fine-tuning its growth strategy while navigating a challenging financial landscape ahead of a planned IPO in next 24-36 months.“Pace yourself; success takes time. Meanwhile, enjoy the journey,” Lunia advises aspiring entrepreneurs.A key lesson here is that timing matters. Many companies have rushed into IPOs driven by market momentum rather than strong fundamentals, which has backfired. Another critical lesson is managing expectations, as public markets operate differently from private funding rounds.We have built a comprehensive digital lending platform and the largest co-lending network for unsecured business loans. Next, we will extend this capability to offer more financial products to a bigger customer base. However, we must continue to invest in technology and refine our risk assessment and underwriting processes.Fullerton’s investment in 2020 was a pivotal moment. We not only raised $87 Mn but also onboarded an investor whose deep understanding of this segment added a lot of value and helped us scale.Above all, we have never sacrificed credit quality for growth. Our risk models are designed to ensure sustainable lending, and we have robust mechanisms to monitor portfolio health. Investors who understand the fintech space know responsible growth is far more valuable than chasing hypergrowth.Our customers are at the heart of these things. They are the true heroes who make our narrative meaningful. Technology is just the enabler.However, compliance is a baseline, not a barrier. We will continue to innovate responsibly as we have always done before.If I could advise my younger self, I would say: Give yourself time. Success does not come overnight. So, be patient and enjoy the journey.

Born into a self-made business family based in Ahmedabad, Lunia is an alumnus of the Indian School of Business and ICAI (Institute of Chartered Accountants of India). He spent a decade in corporate banking, holding senior positions at ICICI Bank and Standard Chartered. However, he left his banking career in 2010 to cater to cash-strapped MSMEs.