Gurugram-based Micro, small and medium enterprises (MSMEs) lender Aye Finance has raised Rs 25 crore from Hinduja Leyland Finance and Intellegrow.
It was a securitization deal, which is a process of taking illiquid assets, and through financial engineering, transforming them into securities, according to the company’s press statement.
The deal was facilitated by Vivriti Capital.
The lending firm will deploy the fresh proceed towards strengthening its lending portfolio and build its loan book.
Aye Finance: Growth chart
This is the second round of securitization funding in the company in the past 10 months. In July 2017, it raised Rs 10 crore by selling a part of its SME loan portfolio under a securitization deal to Mahindra & Mahindra Financial Services.
The lending platform has also raised debt funding in worth of Rs 250 crore this financial year.
In January this year, the company raised Rs 40 crore in debt funding from IFMR Capital. Last year in September, Aye Finance raised Rs 44 crore rupee-denominated debt from the Netherlands-based Triodos Bank’s wholly owned asset management subsidiary Triodos Investment Management.
Incorporated in 2014 by Sanjay Sharma and Vikram Jetley, Aye Finance provides customer-centred financial services to micro and small businesses. It focuses solely on micro and small enterprises with Rs 10 lakh to Rs 1 crore in turnover every year.
The startup claims to have disbursed Rs 500 crore to more than 40,000 customers since its inception. It has more than 72 branches across 10 states in North and South India.
Industry growth
The company competes with Lendingkart, InCred, Capital Float, Indifi Technologies, and many others.
Another fintech firm Lendingkart raised $87 million in equity funding, led by Singapore’s Fullerton Financial Holdings (FFH) in February, this year. The firm has so far raised a total funding (equity and debt) of $173 million.
According to the Reserve Bank of India (RBI), NBFC loans have grown at 16.6 per cent, compared to 8.8 per cent in the banking sector in 2017.
The RBI’s Financial Stability Report (December 2016) showed a 33.1 per cent increase in loans and advances given by deposit-taking NBFCs and a 12.5 per cent increase in advances given by the non-deposit-taking NBFCs.
