Fin-tech startups in India have seen decent cash coming in now. IndiaLends, another fin-tech startup, which connects consumers to lenders providing lower rates of interest, has raised an undisclosed amount of funding in its pre-Series A funding round from DSG Consumer Partners and Siddharth Parikh.
With the new cash inflow, the company is planning to use money to expand its operations across the nation and to invest for the enhancement of its technology. It is planning to start operations in 10 major cities of India by the end of current year. Other investors have also participated in this round but name are undisclosed.
Founded in 2015 by Gaurav Chopra and Mayank Kachhwaha, Indialends is an online marketplace that connects consumers (salaried and self-employed individuals) looking for low rate loans with institutional lenders looking for higher risk-adjusted returns.
IndiaLends uses a proprietary algorithm that aggregates and analyses information from a large number of data sources like the credit bureau, the application form, social networks, etc. It uses a combination of analytics and judgmental oversight to screen potential borrowers. Once analysed, the borrowers are put in contact with relevant lenders for further proceedings.
The company claims that it has underwritten about 1,500-2,000 applications and has paid out Rs. 2 crores in loans till date.
Gaurav Chopra, co-founder of the company, said,
In India, organised lending is available only to a lucky few — mainly those with high CIBIL scores. The remaining borrowers are at the mercy of unorganized lenders and loan sharks, and end up paying outrageously high interest rates.
Deepak Shahdadpuri, MD, DSG Consumer Partners, who have invested in this round, said,
This will reduce the cost, provide a better mechanism to price risk, reduce time to assess credit and provide credit for the first time to many individuals who would not otherwise be able to access the formal credit channels.
IndiaLends will compete with the likes of Capital Float, a Bangalore-based company which provides loans to small and medium businesses. It recently raised $13 million in a fresh round of funding, led by SAIF Partners and Sequoia Capital, with participation of Aspada.
However, principally aligning more with Indialends’ mode of operation is another startup CreditMantri, which recently scooped up $2.5 Million from IDG Ventures and others, for a similar platform.
CreditMantri helps you to take charge of your credit health, thus helping you make better borrowing decisions. It is focused on simplifying credit and tries to help you understand your credit worthiness and provides individual credit assessment, and whether you are eligible for a loan from leading banks or not.