Chennai-based fintech startup CredAvenue has raised $90 Mn in Series A funding led by Sequoia Capital. The investment round also saw participation from Lightspeed, TVS Capital Funds, Lightrock, Kunal Shah-led CRED, and Stride ventures, among others.
This is the second-largest Series A investment that the Indian startup ecosystem has witnessed just behind GlobalBees’ $150 Mn raised in July this year.
The capital infusion has pegged the valuation of the startup to $410 Mn. CredAvenue will utilise the fresh infusion of capital to expand its product capabilities and ramp up its technology and data science infrastructure. The startup aims to make large investments in data science, machine learning and artificial intelligence.
Founded by Gaurav Kumar in 2017, CredAvenue is a debt platform that connects enterprises with lenders and investors. The startup is not an NBFC, meaning it can’t lend users on its own.
The startup has five platforms for different types of requirements for both borrowers and investors.
- CredLoan: It provides term lending and working capital solutions for enterprises
- CredCoLend: For banks and NBFCs for co-lending partnerships
- Plutus: Bond issuance and investment for institutional and retail participants
- CredSCF: For trade financing solutions
- CredPool: For end-to-end securitisations and portfolio buyouts
Apart from these platforms, the fintech startup also offers portfolio management and monitoring services as SaaS offering to its clients.
At present, the startup employs over 350 employees across verticals, and plans to double the headcount by the end of the next financial year. The startup also has plans of global expansion and making strategic acquisitions to fuel inorganic growth.
The startup claims to have facilitated transactions worth over $9 Bn while engaging with more than 1,500 institutional borrowers and more than 750 investors, helping them touch over a million retail borrowers.
Sakshi Chopra, of Sequoia India said that the venture capital is aligned with CredAvenue on its vision to deepen the debt markets in India, “which remain underdeveloped at approximately 65% of the GDP, well behind the global average of 150%”.
Gopal Srinivasan, Chairman at TVS Capital Funds Ltd, said, “With its easy access and the right information, the platform is facilitating larger participation of retail investors in the corporate debt market, which is driving financial inclusion in the fixed income category and is an enabler for the national economic direction in the much-needed deepening of the bond markets in India. We are convinced that CredAvenue can be the leader in this transformative journey of Indian debt markets.”
Digital lending is considered to be one of the fastest growing segments in India’s evolving fintech industry. As per a statista report, India’s market of digital lending grew from $9 Bn in 2012 to $150 Bn in 2020.
The report estimates that COVID19 outbreak has resulted in individual and small businesses to approach online lenders rather than traditional banks because of poor credit scores. This trend is likely to push the digital lending market to touch $350 Bn by 2023.
Update: (September 30, 2021 at 6:04PM) – GlobalBees led the highest Series A round worth $150 Mn in India. The story has been updated reflecting the same.