Gurugram-based OfBusiness, an SME financing, and product fulfillment platform has secured Rs 25 crore in debt funding from Kotak Mahindra Bank.
This debt is in addition to the existing Rs 50 crore working capital committed by the bank taking its working capital limit to Rs 75 crore. Earlier, it had raised $5 million at the inception stage from Matrix Partners and a host of angel investors.
the startup will use the fresh funds for geographical expansion to 10 more SME clusters by end of this year and deepening presence in current and newer sectors. It will also ramp up its technology platform BidAssist.
In December, last year the B2B marketplace has raised $11 million in its series B round of funding led by Zodius Technology Opportunities Fund with participation from existing investors.
Founded in 2015 by Ashish Mohapatra, Bhuvan Gupta, Ruchi Kalra, Srinath Ramakkrushnan, Nitin Jain, Chandranshu and Biswajit Mishra, OfBusiness caters to 22 SME clusters across 7 states in the country.
The firm essentially helps SMEs in sectors such as auto ancillaries, power equipment vendors and capital goods manufacturers with raw material procurement and purchase financing, besides other services such as quality check and transit insurance.
Since inception, the fintech company has disbursed Rs 400 crore, with Rs 110 crore in assets under management, and bad loans of less than 1%. Now it aims to disburse about Rs 700 crore in 2017-18, compared with Rs 220 crore in the previous fiscal year.
“When it comes to getting secured and unsecured credit or cost-effective raw material procurement, SMEs are fully dependent on informal channels and local distributors. With an NBFC license and the right cost of capital through our debt lines, we are bundling innovative lending and procurement solutions to address the growing needs of SMEs in India,” said Mohapatra, co-founder and CEO, OfBusiness.