Fintech startup Lendingkart‘s NBFC arm has raised $15 million in debt funding from The Netherlands-based entrepreneurial development bank, FMO, the company said in a press release on Tuesday.
The funds will help, which provides short-term working capital loans to the SME and MSME sector, expand the reach of its financial products to over 100 sub-industries across India, via its digital platform, the startup said.
Lendingkart’s NBFC arm, Lendingkart Finance Ltd, which has helped disburse over one lakh loans to more than 90,000 MSMEs across 29 states, has actively been fuelling the struggling MSME sector which took massive hits because of the COVID-19 crisis last year.
“The funding demonstrates the continued international support towards India’s vibrant MSME sector and its critical role in contributing to India’s vision to become a $5 trillion economy vision,” said Harshvardhan Lunia, Co-founder and Managing Director, Lendingkart, in a press statement.
“With this new fundraise, Lendingkart will fast-track its efforts to improve financial inclusion and credit reach to our small businesses and women entrepreneurs,” he added.
The parent company, Lendingkart Group, counts marquee names such as Fullerton Financial Holdings (FFH) (a unit of Singapore’s Temasek Holdings), Saama Capital, Mayfield India, India Quotient, Bertelsmann India Investments, and Sistema Asia Fund as its investors, and has raised Rs 1,000 crore in equity funding, till date.
“The new transaction is aligned to FMO’s ambition to accelerate financial inclusion through innovative technological solutions. As India recovers from the pandemic and uncertainties presented by it, we are pleased we can partner with Lendingkart to better support its customers, with a focus towards women-run businesses and micro-enterprises,” Huib-Jan de Ruijter, Chief Investment Officer at FMO said.
In FY20 alone, the startup disbursed 53,000 loans, up 83 percent over 2019, the company told YourStory in an interview. It also managed to raise Rs 319 crore equity in Series D funding during the pandemic.
The MSME sector is an important contributor to India’s growth story. According to the Confederation of Indian Industry (CII), the sector contributes 6.11 percent to the manufacturing GDP, 24.63 percent to the GDP from service activities, and 33.4 percent to India’s manufacturing output.