Delhi-based online lending platform Cash Suvidha has raised $2.3 Mn in debt funding through private placement on non-convertible debentures and from various financial institutions. The amount has been raised in the first quarter of FY 2019-20.
Cash Suvidha will use the funds to increase the loan books of the company. The company has raised $18.75 Mn funding till date, with $2.5 Mn in February last year.
Founded in 2016, Cash Suvidha offers business loans to small and medium enterprises (SMEs), micro small and medium enterprises (MSMEs), and women entrepreneurs as well as personal loans to individuals.
Cash Suvidha provides loans with a ticket size of INR 50,000 – INR 5 Lakh for SMEs and INR 15K – INR 50K for MSMEs. The company has tied up with over 25-30 players to expand business across India and has targeted a 4x increase in processing loan applications.
In terms of future plans, Cash Suvidha is targeting more tie-ups for business expansion.
Geeta Goswami, cofounder, Cash Suvidha, said, “Cash Suvidha’s financial performance has been strong since inception and we are glad to have significantly captured the market in just 3 years. This capital infusion will allow us to further accelerate our fast-growing lending platform and enhance our ability to provide the best terms to borrowers that do not have an established credit history.”
Some of the leading digital lending players include ZestMoney, AyeFinance etc. They have been providing loans to B2B and B2C loans i.e. to SMEs as well as individuals while players such as LoanTap, EarlySalary, Credy, Qbera, EarnWealth, etc enable B2C i.e. customer loans.
DataLabs by Inc42 said that between 2015 and Q1 2019, the total investment in Indian fintech startups was $7.62 Bn with a total deal count of 478. Out of the total funding, 50.13% or $3.82 Bn was in payments tech startups, which was followed by 25.49% ($1.94 Bn) in lending tech startups. In Q1 2019, the total recorded funding in lending tech startups was $322 Mn which is 3.18x higher than the average quarterly funding in this sector which stands at $101 Mn.
As per a survey conducted by BCG and Google in 2018, 23% of consumers in India have availed of retail loans digitally. Another interesting fact presented in this report says SME loans and personal loans have the highest digital influence as well as purchase rate.
As per DataLabs by Inc42 estimates, the credit demand in India is projected to be worth $1.41 Tn by 2022. The estimated growth rate in credit demand is 3.73% between FY17 and FY22.