Global impact investor, BlueOrchard, has invested Rs 87 crore in Micro, Small and Medium Enterprises (MSMEs) lender, Aye Finance, in a debt round of funding. The funds will be used in rolling out several affordable and customisable credit solutions to the small business sector and empower them.
The fintech start-up is aiming to raise Rs 1,500 crore in total in the current year. It has already raised Rs 700 crore so far. In September, Aye Finance raised Rs 65 crore from Geneva-based Symbiotics Investments. This was also a debt round.
The Gurugram-based company which provides unsecured loans to the MSMEs was founded in 2014 by Sanjay Sharma and Vikram Jetley. It is also backed by investors such as Capital G (erstwhile Google Capital), Elevation Capital, Falcon Edge, A91 Partners, and more.
Commenting on the fundraise, Sharma who is also the Managing Director of Aye Finance, said, “Aye is in the sweet spot of providing small ticket customized credit solutions to over 60 million micro enterprises that have been overlooked by traditional lending channels as our innovative solutions and process automation brings unexpected economies in our business.”
In addition, Pranav Murari, Senior Investment Officer at BlueOrchard (Asia) noted that they are supporting Aye Finance because it is “serving a client segment that has been largely underserved.”
The Indian MSME segment holds a significant role in India’s growth trajectory. It contributes about 30 per cent to India’s GDP, and 45 per cent to India’s exports and is also the second largest employer of workforce after agriculture, as per data shared by the Micro, Small, and Medium Enterprises Ministry. Prime Minister Narendra Modi has often highlighted the critical role this sector will play to help India become a $5 trillion economy.
Aye Finance closed the last fiscal year (FY2022) with a loan book of Rs 1,730 crore. It aims to disburse loans worth Rs 2,400 crore in all this year. Since its inception, it claims to have catered to 40,000 micro entrepreneurs.
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