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Kinara Capital secures fresh funding from Gaja Capital, others
Photo Credit: VCCircle

Non-banking financial company Kinara Capital has raised Rs 100 crore ($14.3 million at current exchange rates) in funding from a clutch of private equity and impact investors.

Kinara, which focuses on micro, small and medium enterprises, raised the capital from Gaja Capital, GAWA Capital, the Michael and Susan Dell Foundation and Patamar Capital, it said in a statement.

The NBFC will use the funding to accelerate its growth in new and existing markets and increase its investment in technology.

Kinara Capital claims to have disbursed loans worth Rs 1,160 crore till date.

“We are honored with the vote of confidence from our investors as we aim to reach new milestones by investing in our people and technology,” said Hardika Shah, chief executive of the firm.

Kinara Capital, which is operated by Visage Holdings and Finance Pvt. Ltd, was founded by Shah in 2011. Shah, who spent several years as a management consultant, globally, started the company to provide collateral-free loans to small businesses. Kinara provides loans of Rs 2-25 lakh to MSMEs, filling the gap between microfinance and commercial capital.

The company will now expand its investments in services that refine the customer experience with features such as autopay and auto-disbursement. On the backend, Kinara will develop its proprietary machine-learning lending algorithms to fast track financial inclusion for thousands of small business entrepreneurs.

The company has 90 branches till date and plans to add 20 more in the states of Andhra Pradesh, Gujarat, Karnataka, Maharashtra, Tamil Nadu and Telangana. Kinara Capital currently has an employee base of 1,000 and will fill about 300 more roles this year.

It raised Rs 32 crore ($5 million then) from Switzerland-based impact investor ResponsAbility Investments AG in July 2018.

Deals in the space

Several NBFCs have attracted significant funding in the past few months.

Last month, InCred Financial Services Ltd has said it raised Rs 600 crore ($86 million at current exchange rate) in a Series A round led by Dutch development bank FMO.

In the same month, responsAbility Investments invested $10 million (Rs 69.5 crore at current exchange rates) via its climate fund in green masala bonds issued by Pune-based non-banking finance company Electronica Finance Ltd (EFL).

In March, NBFC Northern Arc Capital Ltd secured fresh investment of Rs 910 crore (around $130 million) from a clutch of institutional investors.

Around the same time, Mumbai-based BlackSoil Capital Pvt. Ltd raised debt capital from a group high-net-worth individuals.

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