Bangalore based digital lending startup Capital Float has raised $45 Million (Rs. 293 crores) in Series C equity funding, said a statement. The round was led by Silicon Valley-based Ribbit Capital, with participation from existing investors – SAIF Partners, Sequoia India and Creation Investments. In parallel, the company has also raised more than $67 million (Rs. 437 crores) in new debt lines from leading banks including RBL Bank, IDFC Bank, Kotak Mahindra Bank and NBFCs including IFMR, Reliance Capital, bringing the total amount of fresh capital raised in the last 12 months to over $112 million (Rs. 730 crores), said Capital Float.
Capital Float said that it will utilize these funds to increase its geographic footprint, improve customer services and launch a new set of credit products for SMEs across India. It will also invest in scaling up its hybrid marketplace model and deepening technology integrations with partner financial institutions.
“We are growing at an exciting pace, currently originating over Rs. 200 crores in disbursals every month. Over the past year alone, we have disbursed loans of over Rs. 2,100 crores to 12,000 plus customers across 300 cities. Our proprietary technology and credit-scoring platform is now able to deliver loans in as fast as 3 minutes via a mobile app. Despite achieving such rapid growth, we have kept our NPAs to 2%, and are on track to reach profitability by the end of current fiscal year, said co-founders Sashank Rishyasringa and Gaurav Hinduja in a joint statement.
Over the past year, the Capital Float has diversified its portfolio, lending to a wide range of sectors including manufacturing, services, e-commerce, transportation, hospitality and retail. Post-demonetisation, the company expanded its lending business to target small merchants and kirana stores, delivering loans as small as Rs. 25,000. These touch-free loans are delivered in seconds via its mobile app, powered by the India Stack, said company.
Capital Float has also created a hybrid marketplace model, where banks and NBFCs “co-lend” alongside the company’s own balance sheet to fund borrowers. The company has currently partnered with 5 institutions, including IDFC Bank and IFMR, and the marketplace contributes to 35% of the company’s total disbursals.
Nick Shalek, partner, Ribbit Capital, which led the Series C, said “We’ve been impressed by the Capital Float team since the first time we talked with them about their business four years ago. The company has achieved remarkable growth by delivering innovative products to small businesses and consumers, while at the same time providing attractive returns to investors on the platform. With this financing, Capital Float is further cementing its lead as the top technology-enabled NBFC in India, and we are thrilled to support the company’s journey.”