Delhi-based lending startup Cash Suvidha has secured $2.5 million from multiple financial institutions in a debt financing round. The round includes $1.5 million through placement of non-convertible debentures (NCDs) and $1 million from two undisclosed financial institutions.
The online lending platform plans to use the fresh influx to expand its lending business to Small and Medium Enterprises (SMEs), reports Moneycontrol.
Incorporated in 2016 by Rajesh Gupta, Cash Suvidha provides business loans to SMEs, MSMEs, women entrepreneurs and personal loans to individuals. The 18 months old company claims to have disbursed a total amount of Rs 122 crore to borrowers.
The lending platform also claimed to receive around 15,000 loan applications every month.
The company has also in-built ‘Suvidha Social Score’, which assesses creditworthiness of borrowers using social media portal, checks educational & professional backgrounds, tracks lifestyle spends, payments behaviour, and spending patterns.
Cash Suvidha levies interest rate in range of 19 to 28 per cent depending upon the profile of the borrower. It promises to provide loans to its clients within two working days.
The platform focuses on both urban and rural India, where the latter gets between 10-15 per cent of overall loan disbursed by the company. It has facilitated credit requirement of over 15000 people in rural India with 12 branches across UP, Uttarakhand and Bihar.
With this round, Cash Suvidha aspires to strengthen its lending business to SMEs and personal loans in top five cities including Delhi-NCR, Bangalore, Pune, Hyderabad and Mumbai.
Cash Suvidha competes with an array of lenders includes Lendingkart, InCred, Capital Float, Indifi Technologies, CreditMantri among several others. Last year, it raised an institutional debt of $2.7 million from various financial institutions.
According to the Reserve Bank of India (RBI), NBFC loans have grown at 16.6 percent, compared to 8.8 percent for the banking sector in 2017.
The RBI’s Financial Stability Report (December 2016) showed a 33.1 percent increase in loan and advances given by deposit-taking NBFCs, and a 12.5 percent increase in advances given by the non-deposit-taking NBFCs.