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TruCap Finance to raise up to Rs 105 crore ($13.1 million) from Zeal Global Opportunities Fund.

The fundraise would be split into Rs 80 crore of equity and convertible warrants and up to Rs 25 crore through NCDs (non-convertible debentures) in the company, said the company in the press release.

Founded in 1994, TRU provides MSME business loans and MSME gold loans through a growing network of more than 67 branches in six states—Maharashtra, Delhi-NCR, Madhya Pradesh, Goa, Gujarat, and Rajasthan.

Rakesh Sethi, Chairperson of the Board of TruCap, said the funding round will enhance the company’s equity base to approximately Rs 325 crore.

“This will invigorate TRU’s efforts to build business at a greater scale with speed, while we continue what we do best, which is to empower small business owners by enabling credit inclusion through lending-as-a-service (L-a-a-S), with a robust risk management framework,” he added.

“TRU has evolved its ability to address multiple pain areas faced by underserved borrowers to access growth capital. It has managed to bridge the credit gap left unaddressed by traditional lenders in the MSME clusters of India,” said Ritesh Abbi, CEO, Zeal Global Opportunities Fund.

“Having proprietary data acquired via disbursement of more than 100,000 loans, TRU has significantly reduced turnaround time, scaled sourcing capabilities, refined the qualification processes, and collections strategies for small businesses lending,” he added

TRU also plans to integrate the retail MSME lending vertical of Exclusive Leasing & Finance, an NBFC focused on providing secured and affordable finance to the MSME sector in India.

“We look forward to leveraging on each other’s strengths to build customer-centric solutions and accomplish our resolve to promote financial inclusion,” VK Bhandari, Chairman of EZ Capital remarked. “This is an opportunity to offer wings to aspirations of countless micro, small and medium entrepreneurs in non-metros to herald a new chapter in the country’s growth story at a global stage, riding on tailwinds of improving economic activity.”

“We are very excited to partner with Zeal Global and EZ Capital in our mission to make a deep societal impact by providing access to timely and affordable finance to MSMEs in semi-urban and rural areas,” said Rohan Juneja, MD and CEO at TruCap Finance Limited.

Tru Cap Finance plans to grow its branch network to over 75 by March 2023. It has disbursed a total of Rs 1,132 crore across more than 121,000 loans to underserved businesses in India.