SUMMARY
NBFCs IFMR, MAS Financial Services Also Add To The LoanTap Funding
Mumbai-based fintech startup LoanTap has raised $4 Mn Series B funding. The round comprised a mix of equity and debt instruments from Kae Capital, India Quotient, IFMR, and MAS Financial Services Ltd.
As per a company statement, equity infusion to the platform was led by Kae Capital with participation from its existing investors including India Quotient and HNIs (high net worth individuals). On the other hand, the debt was raised from NBFCs such as IFMR and MAS Financial Services Ltd.
“We saw strong demand reflecting in the growth since our last round of investment and we believe that innovative personal loan products from LoanTap would serve a large segment not served by traditional banks”, said Madhukar Sinha, co-founder at India Quotient.
The fintech startup will use the funds to enhance collection features in its software, besides reaching out to Tier II and Tier III cities of India.
How LoanTap Works
LoanTap was launched in early 2016 by Satyam Kumar and Vikas Kumar. It is an online personal loan company. It follows an agency-based collection model and allows users to make flexible single and bulk payments of loans.
Users can avail products ranging from regular EMI-based loans, EMI free loans, to personal line of credit. Borrowers can also choose custom-made loan products like overdraft facility, credit card takeover loans, rental security deposit loans, advance salary loans, and consumer durable loans.
The loans are disbursed directly through its in-house, RBI-registered NBFC to ensure a transparent pricing structure. The company combines customer portal, loan origination, loan processing, loan management and accounting at one platform.
Commenting on the development, Satyam Kumar, CEO, LoanTap said, “We have been able to demonstrate that, for discerning millennials, product experience far outweighs upfront pricing modules adopted by traditional lenders in India. Customers are choosing products that deliver flexibility, seamless experience, and lifetime cost advantage over perceived financial benefits.”
As per a company statement LoanTap receives 5,400 to 6,000 loan enquiries every month. Out of these about 600 files make initial cut and travel through the credit process.
The platform claims to have received more than 47K loan applications since its launch. In September 2016, LoanTap raised $3 Mn in Series A funding. The investment was led by HNIs Dr. Abhishek Pandey and Jaysukh Sapra.
The Indian fintech market is forecasted to touch $2.4 Bn by 2020, a two-fold increase from the market size currently standing at $1.2 Bn. Just yesterday Mumbai-based fintech startup Kissht raised $2 Mn from Hyderabad-based early-stage venture capital firm Endiya Partners, and Ventureast.
Earlier this month, consumer lending startup MoneyTap raised about $12.3 Mn funding in a round led by Sequoia India. Existing investors New Enterprise Associates and Prime Venture Partners also participated in the round. Apart from LoanTap other startups in the consumer lending space include Lendingkart, FlexiLoans, KredX, Capital Float, etc.
