SUMMARY
Dutch development finance institution FMO led the funding round
The funds will help the company boost its balance sheet lending
InCred will further invest funds in technology development
Mumbai-based digital lending startup InCred has closed its Series A round at $85.89 Mn (INR 600 Cr). The funding round was led by Dutch development finance institution FMO with participation from US-based asset manager Moore Capital, India/Latin America-focused PE fund Elevar, and Alpha Capital.
The funds will help the company boost its balance sheet lending. It will also help InCred in making further investments in technology initiatives to drive analytics and risk management capabilities.
Bhupinder Singh founded InCred in 2016 to offer a simplified lending platform. The startup offers various types of loans, including personal, home, education, SME, and two-wheeler loans.
The startup has a business footprint across more than 20 cities in India and envisages deeper penetration in these cities, along with its expansion into Tier 3 Indian cities.
This development came after reports surfaced in July 2018 that digital lending startup InCred has received Reserve Bank of India’s (RBI) approval for the wholesale business which will be housed under a separate entity and was in the process of raising fresh equity.
In terms of financial performance, InCred recorded a 55X jump in consolidated revenue reaching INR 132.44 Cr in FY18 with a net profit of INR 9.38 Cr.
In the digital lending sector, InCred competes with players such as Lendingkart and Aye Finance. Here are a few recent fundings in the sector:
- April 2019: Bengaluru-based digital lending startup ZestMoney raised $20 Mn in a funding round led by Washington DC-headquartered fintech investor Quona Capital
- April 2019: Bengaluru-based full-stack consumer lending company Credy raised an undisclosed amount in a Pre-Series A round of funding.
- January 2019: Pune-based digital lending startup LoanTap raised $8 Mn (INR 57.9 Cr) from a combination of debt and equity for its fifth funding round which was led by early stage venture capital fund 3one4 Capital.
- January 2019: Digital lending company Aye Finance raised $10 Mn (INR 71.32 Cr) in a debt funding round from global impact investment manager, responsAbility and Northern Arc, through the issuance of non-convertible debentures
Inc42’s Annual Tech Startup Funding report 2018 has noted that fintech startups raised $1.4 Bn across 121 funding deals in 2018, with top-five funding grossers being PolicyBazaar, Pine Labs, LendingKart, PhonePe and ClearTax.
Further, Inc42 DataLabs has found that digital lending has become the third most funded segment in fintech. As one of the most active sector, fintech players are under constant scrutiny to perform and to deliver an escalated growth rate. InCred in its heydays has been one of the most active player and continues to stand its ground in the cut-throat competition.
