Digital lending startups are having a ball in India. In yet another funding in this space, microlender Upwards has raised about $5 million in its Series A funding round led by Chinese venture capital firm Shunwei Capital with participation from existing investors Mayfield and India Quotient.
The Mumbai-based fintech firm will use the risk capital to ramp up its technology and data science capabilities to scale up its loan book by next year.
Founded in 2017 by Abhishek Soni and Nimesh Verma, Upwards provides collateral-free personal loans of up to Rs 50,000 to borrowers in over 30 cities including Mumbai, Delhi, Bengaluru, and Chennai.
Since its inception, Upwards has disbursed loans worth Rs 7-8 crore to 5,000 customers and it claims to have a loan book of about Rs 5 crore. To optimise the customer acquisition cost, the startup is also experimenting with multiple profiles having a salary lower than Rs 15,000.
Typically, Upwards charges a processing fee of 2 per cent on the loan amount and levies interest rates of 18-32 per cent.
With the fresh capital infusion, Upwards is targetting a monthly loan disbursal run rate of Rs 25-30 crore and increase the current loan book to Rs 100-120 crore over the next year, reports Mint.
Besides, LoanTap, Creditmate, KrazyBee, Redcarpetup, and Early Salary are some notable lending platforms in this space.
The lead investor Shunwei Capital has been showing an aggressive approach in Indian startups especially in the field of vernacular content and lending. Floated by Lei Jun, Shunwei had previously invested in Bengaluru-based microlending platform KrazyBee, and LoanTap.
The investment arm of Xioami, Shunwei is also planning to offer loan to salaried professionals in India via KrazyBee.