Digital lending platform EarlySalary has raised $110 million in a new round led by TPG’s The Rise Fund and Norwest Venture Partners. Existing investors Piramal Capital and Housing Finance Limited also participated in the Series D round.
According to EarlySalary, the round also includes a secondary component and has valued the Pune-based startup at $300 million. The fresh funds will be used to enter new markets, accelerate its loan book, and towards skill upgradation.
On August 12, Entrackr reported about the upcoming round in EarlySalary.
The new round is coming almost after a gap of two years. In October 2020, it raised $10 million as part of its Series C financing from Eight Road Ventures and Chiratae Ventures. Entrackr had exclusively reported the fundraise then. The startup has raised $144 million to date.
Founded by Akshay Mehrotra and Ashish Goyal in 2015, EarlySalary partners with small, medium and large companies to offer short-term loans of up to Rs 5 lakh for shopping, travel, education, and medical emergencies to their workforce. Its product portfolio includes instant loans, personal loans, BNPL and SalaryCard.
According to the company, it has around 12 million app downloads with 80% of the users being repeat customers. Currently, it is present in 150 cities and aims to add 100,000 new users every month. It has already disbursed nearly 2.8 million loans worth Rs. 7,500 crore (nearly $1 billion).
EarlySalary directly competes with Slice, ZestMoney, LoanTap, PaySense, MoneyTap, and IndiaLends among a few others. In the employee financial benefit space, it also competes with Refyne, Jify, Kaarva, Daily Salary.
EarlySalary was also under the scanner after the Reserve Bank of India released a circular for fintech companies in June. As per the circular, Prepaid Payment Instruments (PPIs) such as wallets cannot be loaded using credit lines issued by non-banking financial companies. The circular impacted several startups such as Slice, Uni, LazyPay, PostPe, Jupiter, MobiKwik, Ola Postpaid, and EarlySalary.
Following the circular, EarlySalary halted its card services (SalaryCard) until further clarification. The virtual card used to provide credit to salaried employees with more credit limits, flexible tenures and hassle-free processing.
While EarlySalary is yet to file its annual financial report for FY22, the company’s revenue from operations decreased by 17% to Rs 84.2 crore in FY21 from Rs 101.6 crore in the previous fiscal year (FY20). It posted a loss of Rs 18.8 crore during FY21.
