Lendingkart Raises $30 Mn Led By Fullerton, Bertelsmann & India Quotient

Ahmedabad-headquartered lending startup Lendingkart has raised $30 Mn (INR 212 Cr) in an equity funding round led by existing investors including Fullerton Financial Holdings, Bertelsmann India Investments and India Quotient.

The funds will be used to expand lending bases, deepen Lendingkart Group’s reach to small and underserved micro enterprises and further strengthen its technological and analytics capabilities. Credit Suisse acted as the exclusive financial advisor to Lendingkart Technologies.

With this round, the total equity raised by Lendingkart stands at $143 Mn. The company has raised debt in June as well, with last round being $11.4 Mn (INR 80 Cr) from Alteria Capital.

Founded in 2014 by ex-banker Harshvardhan Lunia and former ISRO scientist Mukul Sachan, Lendingkart is an instant working capital finance platform that provides SMEs with easy access to credit and working capital.

Harshvardhan Lunia, cofounder and managing director of Lendingkart Technologies, said, “We are pleased with the momentum in our business and this equity will help us meet the growth opportunities we are seeing. Micro and small businesses represent a vibrant yet underserved segment of the Indian economy.”

The NBFC arm, Lendingkart Finance has evaluated nearly half a million applications, disbursing over 60K loans to more than 55K MSMEs in over 1300 cities across all 29 states and union territories. Yeo Hong Ping, president, Fullerton Financial Holdings said that over the past year, Lendingkart’s business has seen robust growth and continues to exhibit great potential.

Pankaj Makkar, managing director, Bertelsmann India Investments said, “Digital lending is revolutionizing access to capital for MSMEs. With focused efforts of the Government and technological advances such as big data, digital lending has set the stage for disruption with greater formalisation, faster capital disbursements and vastly improved customer experience.”

Lendingkart Technologies reported a three-fold increase in its consolidated revenue to $13.1 Mn (INR91.8 Cr) for FY18 but its total expenses almost doubled from $108 Mn (INR 75.5 Cr) in FY17 to $20.7 Mn (INR 144.15 Cr) in FY18 which led to widening losses for the company.

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.

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, 25.49% ($1.94 Bn) was in lending tech startups.

The prevalence of digital lending startups in India has opened new opportunities for synergies between fintech startups and established financial institutions and banks. Some of the leading lendingtech startups include CASHe, Stashfin etc.