Flexiloans, a Mumbai-headquartered digital lending platform catering to MSMEs, has raised Rs 290 crore ($35 million) in its Series C round led by Accion, Nuveen, Fundamentum, and existing investor Maj Invest.
The firm will use the funds to expand its operations, enhance its product offerings, and strengthen its technological infrastructure, it said on Wednesday.
India’s SME sector, which contributes about 30% to the country’s GDP, remains significantly underserved. Less than 10% of MSMEs have access to loans from traditional financial institutions, leaving a vast capital gap.
Founded in 2016, by Deepak Jain, Ritesh Jain, and Manish Lunia, Flexiloans aims to bridge this gap, particularly in tier 2 and tier 3 cities where access to finance is limited. As the Indian economy continues to expand, the demand for MSME financing will only increase, presenting a substantial opportunity for FlexiLoans, the firm said.
FlexiLoans has disbursed over Rs 7,000 crore in loans across more than 2,100 towns & cities and boasts over Rs 2,000 crore in AUM.
In 2022, Flexiloans raised $90 million Series B capital in a mix of equity and debt led by Danish private equity (PE) firm MAJ Invest, with the participation of UK-based fintech investor Fasanara Capital and the family offices of Harry Banga and Yogesh Mahansaria alongside many existing shareholders such as Sanjay Nayar.
So far, the firm has received total funding of Rs 636 crore in equity and over Rs 2,000 crore in debt.
In India, small businesses often face problems while accessing funds for expansion. Industry estimates suggest that over 80% of the loan proposals from SMEs are often rejected by institutional channels on account of inadequate financial history or collaterals.
Flexiloans’ competitors include Slice, Stashfin, Lendingkart, Money View, and LendenClub.
