Cash Suvidha raises $2.7 Million in debt from various financial institutions

Delhi-based micro-lending startup Cash Suvidha has raised an institutional debt of $2.7 million from various financial institutions.

The parent company, Usha Financial Services Pvt. Ltd., has not shared the names of the investors, except to state that the amount has been shared between 6 financial institutions, according to a VCCircle report.

The startup, which extends business loans to SMEs, MSMEs, women entrepreneurs and personal loans to individuals, will deploy raised capital to increase its portfolio of SME and personal loans, especially in markets such as Delhi-NCR, Bangalore, Pune, Hyderabad, and Mumbai.

Commenting on the development, Mr. Rajesh Gupta, Founder of Cash Suvidha, said, “This working capital infusion will provide propulsion for further accelerating the company’s exciting growth plans. The funds raised will be used to replenish our loan book and widen our reach across the country. We are confident that our relationship with these institutions will help us in empowering more SMEs by addressing their working capital requirements”

Founded in June 2016 by Gupta, Anoop Garg and Geeta Goswami, Cash Suvidha has developed its own ‘Suvidha Score’ for assessing creditworthiness using social media portals to check educational & professional backgrounds, tracking lifestyle spends, payments behaviour, and spending patterns.

Cash Suvidha is driven by information-based lending, online application acceptance; best-in-industry interest rate and viability based financing. It disburses loans in 48 hours at 19-28% on reducing balance EMIs. The decisions are taken based on its logarithms of human behaviour, the social quotient of the borrower, etc.

According to the company, it receives around 15,000 loan applications per month and has disbursed a total amount of 102 Cr. to more than 27,000 borrowers since its inception. The startup has also partnered with HomeCapital recently to extend unsecured credit at zero percent interest to first-time homebuyers.

There are several fintech startups that have emerged in the consumer and SME loans segment. Government’s push towards financial inclusion, digitisation, and start-up programmes has also provided a strong foundation to the FinTech sector in India.

Startups such as FinBucket and FlexiLoans have also been in the news recently for having raised funding. FinBucket raised $1.8 million earlier this week from early-stage venture capital firm Impanix Capital while another startup called FlexiLoans raised $6.98 million in debt earlier this month.