Financial technology company, Progcap which offers collateral-free loans to retailers across the country and that focuses on retail financing has announced raising $25 million in a Series B funding round led by Tiger Global and existing investor Sequoia Capital India at an undisclosed valuation.
The India-based startup, Progcap claims a user base of 3 lakh retailers across 50 corporates and Rs 1,500 crore in loan disbursals to date. According to company top management, the newly infused equity capital will be used by the startup to expand its team and diversify its product offerings.
The company founded by Pallavi Shrivastava and Himanshu Chandra, Progcap offers collateral-free loans to retailers across the country. The fintech startup aims to reach more than 5 million enterprises by the end of 2023. Its last funding round was in February, when it raised $1.4 million in debt from Stride Ventures and others.
“We are excited to have Sequoia Capital India double down on Progcap and thrilled to have Tiger Global join us in our journey. The continued faith that our customers, partners, and investors have put in us is a testament to our teams' unrelenting efforts,” Progcap founders Shrivastava and Chandra said in the statement.
To be sure, Tiger Global has been bullish on India's fintech sector this year, leading or participating in funding rounds of Cred, Groww, and Plum among others. The New York-based investment firm is reportedly in talks to invest in BharatPe.
“We are thrilled to partner with the Progcap team as they help small and mid-size businesses access to financing. We believe Progcap has an exciting path ahead as they continue to innovate in this underserved market,” Tiger Global partner Scott Shleifer said.
According to Ashish Agrawal, principal at Sequoia India, the formalization of India's $800 billion retail markets is an opportunity for financiers catering to this segment. “Progcap has built a unique product to cater to the working capital needs of small Indian retailers who serve much of India's USD. As supply chains in India get formalized with GST, the company will play an important role in serving the financial needs of such retailers,” Agarwal said.
