Capital First, others invest in digital lender SMECorner
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DigiKredit Finance Pvt. Ltd, which operates digital lending platform SMEcorner, has raised $7 million (Rs 47.5 crore) in an investment round led by non-banking financial company Capital First Ltd.

SMEcorner’s chief executive Samir Bhatia told VCCircle that existing investors Accion Venture Lab and Dutch Good Growth Fund had also contributed.

The investment is a combination of equity and debt, he added.

Capital First said in a stock-exchange filing that it had agreed to acquire a 14.24% stake in SMEcorner for Rs 12 crore ($1.7 million) as it seeks to tie up with the firm for loan origination. The transaction is expected to be completed within the next 15 days, it added.

Bhatia said the other investors provided an additional Rs 10 crore in equity investment, while Capital First contributed a further Rs 25 crore in debt.

He also said the firm plans to raise another equity round of $10-20 million by the end of this fiscal and separately another $15 million in debt. The company is looking to disburse loans worth Rs 300-400 crore in this financial year, he added.

Digikredit, through its digital lending platform SMEcorner, offers access to business loans for micro, small and medium enterprises.

Incorporated in November 2013, the company received its non-banking financial company (NBFC) licence from the Reserve Bank of India in February and commenced NBFC operations soon after. It currently has a loan book of Rs 45 crore.

Last year, VCCircle reported that SMEcorner had raised about Rs 2.6 crore ($400,000) from the Dutch Good Growth Fund, which is a fund of funds investment initiative by the Dutch Ministry of Foreign Affairs.

In August 2015, Accion Africa – Asia Investment Company had put in Rs 2.2 crore in the company, according to VCCEdge, the research arm of News Corp VCCircle.

Capital First is backed by Singapore sovereign wealth fund GIC and private equity firm Warburg Pincus.

In January this year, IDFC Bank had agreed to acquire Capital First in a share-swap deal valued at about $1.5 billion. Reserve Bank of India approved the merger earlier this month.

Deals in the space

Earlier this month, CoinTribe, a credit-based lending marketplace for SMEs, had raised more than $10 million (Rs 67 crore) in a Series B funding round led by India-centric mid-market private equity firm Sabre Partners.

In April, Bengaluru-based digital lender Capital Float raised $22 million (Rs 144 crore) in equity funding from e-commerce major Amazon India. The funding was part of a $45-million Series C round.

In February, Lendingkart Technologies Pvt. Ltd, the technology and digital marketing arm of Ahmedabad- and Bengaluru-based fintech startup Lendingkart, had raised Rs 565 crore ($87 million) in a Series C round of funding led by Singapore’s Fullerton Financial Holdings Pte Ltd.

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