The funding will be used to scale up its product, technology, and data analytics. It will also be used to build a loan portfolio for small businesses.
Post the investment, GrowX Ventures’ MD Ashish Taneja will join Ziploan’s board of directors.
Founded in September 2015 by Kshitij Puri and Shalabh Singhal, the startup offers short-term loans to Medium and Small and Medium Enterprises (MSMEs), without any collateral. It uses a proprietary credit scoring software called Zipscore.
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Talking about the funding, Kshitij Puri, co-founder, ZipLoan said, “This is a segment, which has found it difficult to get credit from other financial institutions given the poor cost-benefit tradeoff with respect to sourcing and underwriting small loans. We are leveraging technology and a wide variety of non-traditional data sources to quickly evaluate credit worthiness and disburse loans in a cost-effective manner.”
Zipscore claims to reduce credit assessment time to a few minutes as compared to traditional financial institutions. It also offers small credit options to entrepreneurs after evaluating credit security. The credit size offered by Ziploan ranges from INR 1 Lakh to INR 3 Lakhs for a time period of 6-24 months.
Commenting on the investment, Ashish Taneja, MD, GrowX Ventures said, “ZipLoan is probably the one team we have come across which is effectively addressing the holy grail of Indian lending i.e. the small business lending. The team at ZipLoan brings in relevant experience to disrupt this space.”
Ziploan had also raised funding from Sarvbir Singh in its Angel round earlier this year. It has also partnered with other NBFCs for co-lending using Zipscore.
Earlier last month, fintech startup for daily wagers Inmotion received funding from 1mg’s founders Prashant Tandon and Gaurav Agarwal. Other startups in the fintech segment that recently got funding are InCred Finance ($75 Mn), NiYO Solutions ($1 Mn), ScripBox (Undisclosed), Celerix($400K), CreditVidya ($2 Mn), and ClearTax ($2 Mn).