Mumbai-headquartered non-banking financial company (NBFC) NeoGrowth Credit Pvt. Ltd, which provides flexible loans to merchants and offers automated repayment options, has secured Rs 300 crore ($47 million) in equity funding from investors led by LeapFrog Investments.
In a statement, the company said existing investors Aspada Investment Company and Quona Capital also contributed to the fundraising effort through Accion Frontier Inclusion Fund, which focuses on inclusive financial technology.
Avendus Capital was the exclusive financial advisor to NeoGrowth for this transaction. VCCircle had first reported in October last year that NeoGrowth was working with Avendus Capital to raise Rs 150 crore ($23 million).
E-mail queries sent to NeoGrowth did not elicit a response till the time of publishing this report.
As part of the investment, LeapFrog partner Michael Fernandes will join the board of NeoGrowth.
NeoGrowth Credit, which does not accept deposits, is involved in the merchant cash advance business. It was founded by serial entrepreneurs Dhruv Khaitan and Piyush Khaitan in 2012 after they sold their transaction processing firm, Venture Infotek.
The company analyses turnover data from a merchant’s point-of-sales terminal to find creditworthiness of the company and claims that it disburses loans in three days.
NeoGrowth says it has partnered with 7,000 business merchants spread across 21 tier-1 and tier-2 Indian cities. It plans to expand to other locations in India shortly.
In July 2013, investment firm Omidyar had picked up 29% stake in NeoGrowth.
Eight months later, the NBFC raised Rs 10 crore ($1.62 million) from Aspada Investment Company.
In April 2015, NeoGrowth raised an undisclosed amount of funding led by Silicon Valley-based social venture investor Khosla Impact.
Competition has intensified in the digital lending space of late. NeoGrowth's rivals include Paytm-backed CreditMate, CASHe, LendingKart, MoneyTap, EarlySalary, Faircent, LoanMeet, among others.
Other online lending platforms have also been raising funds in recent months.
In December, Delhi-based Usha Financial Services Pvt. Ltd, which operates online microlending platform Cash Suvidha, raised $2.7 million (Rs 17.31 crore) in debt funding.
The month before that, One97 Communication Ltd, which runs mobile wallet firm Paytm, picked up a stake in Mumbai-based fintech startup CreditMate.
In October, ZipLoan, operated by Delhi-based Blue Jay Finlease Ltd, raised Rs 20 crore (around $3 million) in a funding round led by Matrix Partners India.
CrediFiable, which is operated by Bengaluru-based OneFiable Technologies Pvt. Ltd, raised an undisclosed amount from Kae Capital in September last year. Leave Your Comment