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Publicly listed small business lending platform U GRO Capital has raised $30 million (about Rs 250 crore) from FMO, the Dutch Entrepreneurial Development Bank, through Non-Convertible Debentures (NCDs). FMO fully subscribed to the INR-denominated NCDs, said the company in a statement.

The MSME lender claims to have offered credit to over 80,000 small businesses over the past five years. The company raised Rs 340 crore in equity capital in 2023, including Rs 240 crore from the Danish Development Finance Institution (DFI) and Investment Fund for Developing Countries (IFU). 

“This transaction is proof of U GRO Capital’s ability to forge partnerships with and attract funding from reputed global DFIs. We share a common vision of financial inclusion with impact funding organisations and are excited to collaborate with FMO to meet the diverse financial needs of India’s underserved MSMEs,” said Shachindra Nath, Founder and Managing Director of U GRO Capital. 

He added, “Impact investors are critical funding partners in enabling us to bridge India’s massive credit gap in the MSME sector, and we will continue to leverage our technology and credit expertise to service MSMEs across the spectrum via our multi-channel distribution model.”

U GRO Capital has partnered with over 10 large PSUs and NBFCs for its lending-as-a-service model. It leverages data analytics and AI/ML statistical models for risk ranking on its credit scoring model, GRO Score.

It also has different modules, including intermediated sourcing through GRO Plus, supply chain financing platform GRO Chain, co-lending platform GRO Xstream, and embedded financing for MSMEs through its GRO X application. 

“We are pleased to partner with U GRO Capital in their mission to empower MSMEs in India. MSME Finance is a key driver for financial inclusion, and U GRO Capital’s mission to solve the small business credit need is in line with our vision of promoting inclusive and sustainable prosperity,” said Aleksandra Gazy, Senior Investment Officer at FMO. 

The company reported assets under management of Rs 7592 crore for the quarter ended September 2023, a 74% uptick from the year-ago quarter, with monthly disbursals of over Rs 500 crore. Profit after tax for the quarter stood at Rs 28.9 crore, up 448% from the year-ago quarter.