SMEcorner, a microlending platform for small and medium businesses, has raised Rs 90 crore ($12.8 million) in debt and equity funding.
Venture capital firm Quona Capital led the round with an equity investment of Rs 35 crore, SMEcorner said in a statement. Existing investors including Accion Venture Lab put in the remaining amount.
Quona made the investment out of the Accion Frontier Inclusion Fund, which is anchored by impact investor Accion International. Quona was earlier called the Frontier Investment Group, which was part of Accion. It is now a separate entity. The fund had last year backed non-bank lender
NeoGrowth Credit, which operates in the same segment as SMEcorner.
SMEcorner, owned by Digikredit Finance Pvt. Ltd, said that the new round takes the total amount of debt and equity funding it has so far raised to Rs 200 crore. It aims to mop up another Rs 300 crore by the end of March 2020.
The company was founded by Samir Bhatia, former CEO and managing director at Equifax, in 2013. It had raised Rs 47.5 crore in a round led by non-bank lender Capital First Ltd in June 2018. Previously, it had secured funding from a Dutch government fund.
SMEcorner which provides small-ticket loans to unorganised retail business owners such as kirana stores, readymade garment sellers, chemists and others. It extends unsecured loans from Rs 50,000 to Rs 25 lakh, and loan against property of up to Rs 1 crore for a period of six months to two years.
The lender obtained its NBFC licence in February 2018. It claims to have disbursed Rs 225 crore in loans since the time of receiving its NBFC licence.
Founder Bhatia said the company plans to use the fresh funding to add customers and disburse about Rs 1,000 crore of loans by March 2020.
The startup uses artificial intelligence applications, which include a combination of a proprietary application score card and Optical Character Recognition, to evaluate the credit-worthiness of businesses. The company claims to have brought down the approval turnaround time to an average of three days against two weeks taken by traditional banks. The platform has a presence across nine cities and has 3,000 unique customers.