Mumbai-based fintech company PaySense has raised $18 Mn in its Series B round of funding led by Naspers-promoted payments provider PayU, after selling an undisclosed stake.
PayU has invested $11.5 Mn in the company while other existing investors including Jungle Ventures and Nexus Venture Partners also participated in the round.
With the latest funding, PaySense aims to tap into the emerging middle class of India and is also looking to hire more people to strengthen its tech and data analytics team.
Till date, the company has raised $25.6 Mn, from investors like PayU, Nexus Ventures, and Jungle Ventures.
Prashanth Ranganathan, co-founder and chief executive, PaySense, said, “India has one of the largest financially underserved populations in the world. We are constantly innovating to serve this population using net new ways of assessing these customers through our instant credit decisioning models.”
Founded in 2015 by Ranganathan and Sayali Karanjkar, PaySense offers individuals, such as working professionals, credit options ranging from INR 5,000 to INR 2 lakh, and does the credit scoring as well as the documentation processes by leveraging India Stack.
PaySense is a startup that is targeting to be a risk assessment provider for 16 Mn Indian households currently underserved by the lenders. The company provides offers like aspirational ecommerce purchases, family vacations, home renovations, and a medical emergency.
Siddhartha Jajodia, global head, PayU, said, “PaySense is leveraging the IndiaStack platform very well to create additional capabilities beyond those of the traditional credit bureaus to generate strong underwriting of retail loans. With these investments, we intend to tap into the emerging middle class of India and provide them with easy access to formal credit.”
PaySense claims to hit INR 50 crore monthly disbursement rate and it is targeting to double it within the next few months.
PaySense is competing with some other players in the alternative lending market, PaySense competes against Lendingkart, FlexiLoans, KredX, Capital Float, EarlySalary, Rupeelend, Myloanbuddy and MoneyinMinutes, among others.
The fintech lending space has also attracted players like Flipkart and Paytm. Recently, it was reported that Flipkart is looking to invest in the Indian fintech market which is said to be worth $2.4 Bn by 2020. The company has also applied for an NBFC (Non-Banking Financial Company) licence to focus on consumer lending.
Paytm, after launching the Payments Bank was planning to enter the mutual fund space. The company has reportedly applied to the RBI for a license to set up a money market fund.
Inc42 Datalabs in its Indian Tech Startup Funding report H1 2018 has found that the fintech sector marked a sweeping victory, occupied the first spot in terms of tech startup funding in H1 2018. Fintech startups raised a combined funding of $631.29 Mn across 70 deals in H1 2018.
It also revealed that 46% of the total funding of $3 Bn in H1 2018 went to fintech and ecommerce alone. With PaySense ready to ramp up its operations in India, the company looks ready for the next phase of growth.
[The development was reported by ET.]