Lending Startup SarvaGram Raises $35 Mn Funding Round To Expand Offline Presence

Rural India-focused lendingtech startup SarvaGram has announced the closure of a $35 Mn Series C funding round. Elevar Equity, Elevation Capital, Temasek and TVS Capital Funds participated in the round.

SarvaGram will deploy fresh funds to expand its distribution network by adding 75 more outlets by the end of FY 2024. It will also use funds to hire tech talent and strengthen its existing tech stack. 

The development comes almost two years after SarvaGram secured INR 77 Cr in a Series B funding round led by Elevation Capital. Existing investor Elevar Equity also participated in the funding round.

Post this round, both investors together held a 50% stake in the lendingtech startup.

Founded in 2018 by banking veterans Utpal Isser and Sameer Mishra, the Mumbai-based lendingtech startup offers credit to underserved people living in rural and semi-urban areas. It mainly provides credit to small businesses, farmers, households and individuals.

The startup claims to provide customers access to productivity enhancement tools, including loans, farm mechanisation services and risk mitigants, among others.

“First, the inflection point in rural markets as demonstrated by growing economic activity and aspirations seen across rural households and second, leveraging the entry point of financial services for a truly data-led broader distribution strategy. This round provides aligned growth capital to help the company execute to their scale ambitions after successfully demonstrating robust financial margins in the business model,” said, Jyotsna Krishnan, managing partner of Elevar Equity. 

The startup plans to expand the number of franchisees ‘SarvaMitra’ by 3X across the country and further, advance its data analytics capabilities and widen its customer funnel. 

It claims to be operating in eight hubs and managing over 50 outlets in four Indian states. It also asserted to have 250+ franchise partners working in over 8,000 villages.

“The fundraise will boost our mission of putting more power in the hands of rural households by enhancing our technology platform, strengthening the data analytics layer apart from growing our distribution and adding on-ground human capacity,” said, Utpal Isser, cofounder, MD and CEO of SarvaGram.

In India, it faces competition from the likes of agriculture farmers-focused lendingtech startups such as Jai Kisan, Arya.ag and Whrrl, among others.

As per an Inc42 report, the Indian lendingtech market will account for 47% (or $616 Bn) in the entire fintech market by 2025. The industry will be expanding at a CAGR of 31% by the forecasted period (2025). 

A slew of funding activities have been recorded in the industry in recent times. The sector recorded $2.2 Bn in funding in 2022 alone, according to Inc42’s annual startup funding report. Aye Finance raising $10 Mn funding, Yellow Metal bagging $3 Mn+, MoneyView securing $75 Mn funding and KreditBee raising $80 Mn are some of the fundraisings that occurred in the past month.