SME Lending Startup Namaste Credit Raises $3.8 Mn In Series A Funding

New Delhi-based SME lending startup Namaste Credit has raised $3.8 Mn in Series A round of funding from Nexus Venture Partners.

The startup plans to use the funding to grow its geographic footprint, continue to enhance its technology and data analytics platform and further scale its businesses.

With this, the startup plans to significantly increase its channel partner programme across India and further expand its technology licensing partnerships with leading lenders globally.

Commenting on the development, Lucas Bianchi, CEO of Namaste Credit, said, “Our technology provides lenders better quality underwriting and reduced turnaround times at significantly lower costs than existing manual underwriting processes. Our clients are witnessing much higher productivity as a result of being able to accurately process physical documents digitally and run automated credit algorithms. This makes our solution truly unique and is driving rapid adoption.”

Founded in 2014 by Gaurav Anand, Lucas Bianchi and Krishnan Parameswaran, Namaste Credit provides the best outcomes for SME borrowers and significantly improves the efficiency of channel partners and lenders alike using machine learning and patent pending algorithms.

On the investment, Anup Gupta, Managing Director, Nexus Venture Partners, said, “SME credit is seriously constrained due to lack of reach and relevant data to assess credit worthiness of borrowers. Namaste Credit’s technology, combined with its channel partners and lender network, is already making a significant impact on facilitating credit to SMEs in a win-win manner for all.”

The startup has witnessed 10x growth in its disbursement volumes in last 12 months. It has increased its loan conversion rates to over 70% with its more than 1K channel partners which are 3x to 5x more productive than their peers and are rapidly increasing usage across all geographies.

Namaste Credit is also using its license core technology to several leading NBFCs and Banks.

In the SME lending space, the major players include Lendingkart and Cash Suvidha among others.

After recent funding round in February, Lendingkart Group’s cumulative equity and debt raising exceeded $173 Mn (INR 1129 Cr). On the other hand, Cash Suvidha last raised funds in March and with this the company’s total funding reached $6.2Mn.

Overall, as per Inc42 DataLabs Indian Startup Funding report 2017, the Indian fintech industry has received $3.01 Bn across 111 deals in 2017. And the sector continued to lead its growth, as according to Indian Tech Startup Funding Q1 2018 report, fintech as a sector witnessed highest funding.

In its report Credit Suisse indicated that the global consumer and SME loan market is expected to reach $3 Tn over the next decade, owing to government’s initiatives to provide hassle-free and cashless financial transactions.

With fintech segment forecasted to touch $2.4 Bn by 2020, the SME segment continues to grow with players like Namaste Credit, however, not without the concerns of underwriting and asset quality of SME lending.