Spearheading Innovation in MSME cash flow financing.
FinAGG Technologies plans to deploy the funds to enhance its phygital presence, amplify global outreach, and fuel innovative product developments.
India, January 18, 2024: FinAGG Technologies, a pioneering force in the MSME financing space, has successfully raised $11 million in its Series A funding round. This financing was co-led by global impact investment manager BlueOrchard and Tata Capital Limited, with participation from the Small Industries Development Bank of India (SIDBI) and existing investor Prime Venture Partners. Additionally, FinAGG secured capital from Gray Matter Capital through Non-Convertible Debentures (NCDs) to empower women entrepreneurs financially. The latest funds infusion will be directed towards expanding FinAGG’s offline and online presence, enhancing global outreach, and driving product innovation.
Commenting on the milestone, Mr Nipun Kohli, Co-founder & CEO of FinAGG Technologies said, “This funding round is a testament to the impact we have created. To add to that we have been able to bring investor partners that share high synergy with us and are experts in their domains. Having the likes of BlueOrchard, who are the leaders when it comes to climate-based impact programs, will help us drive the penetration of climate insurance to our client, Tata Capital, which is one of the biggest NBFC in India, will help us scale our business operations to new heights and SIDBI, which is a development back owned by GOI, will help us grow GST Sahay through access to cheap funds.
Further the money that we have raised will go into bringing disruptive changes in this industry. Our Product and Engineering department is currently working on bringing blockchain to an industry which worked on conventional pen and paper underwriting until recently. These new features will help us look at borrowers under a completely different light and make underwriting in this space more meaningful.”, he added.
In the context of India’s MSME landscape, where approximately 6.3 crore micro, small, and medium-sized enterprises contribute significantly to the GDP and employment, FinAGG addresses the pressing issue of limited credit access for these enterprises. The supply chain finance gap in India is estimated at INR 60,000 Crores, with FinAGG having disbursed over INR 5230+ Crores to over 85,000 MSMEs to date. Notably, around 20% of these enterprises are led by women entrepreneurs, fostering annual sales growth of 22% and promoting financial awareness and inclusion.
Mr Srini Ramki, Co-founder & CTO of FinAGG Technologies, said, “We’ve made a significant impact, reaching over 85,000 borrowers in 100 T1 and T2 cities. Witnessing the growth journey of these enterprises has been a privilege, and I express deep gratitude for being part of their transformative narratives. The funds secured in this round are pivotal for our future endeavors. They will play a crucial role in expanding our reach pan India, aligning seamlessly with our ambitious goal of positively impacting over 250,000 lives by March 2025. This financial infusion not only propels our expansion but also solidifies our commitment to making a meaningful difference in the MSME financing landscape, amplifying the tangible outcomes of our collective efforts.”
Additionally, FinAGG Quick Cash Flow platform, having completed the RBI Sandbox for MSME Lending in November 2023, leverages technology to offer low-cost loans seamlessly.
Rajiv Sabharwal, the Managing Director & Chief Executive Officer of Tata Capital said, “Initiating a strategic investment drive, we selectively invest in businesses aligned with our goals. Our existing partnership with FinAgg in the SME supply chain has been successful, showcasing promising traction. We value FinAgg’s tech-driven efficiency and focus on distributor finance access. Excited about our continued collaboration, we anticipate a fruitful partnership and are committed to supporting FinAgg’s next phase of growth. Together, we aim to drive innovation and excellence in the evolving landscape of financial services.”
Mahesh Joshi, Head of Private Equity Investments- Asia at BlueOrchard, said, “FinAGG’s innovative model employs technology to seamlessly provide cost-effective loans to MSMEs. Rapidly becoming a premier partner to blue-chip companies in FMCG, consumer electronics, and building materials, FinAGG gains access to millions of Indian MSMEs. Our collaboration with FinAGG is aimed at enhancing financial service accessibility, propelling growth, and fortifying the resilience of the vulnerable MSME sector in India. Together, we aspire to make substantial contributions to the economic empowerment and sustainability of MSMEs across the nation.”
Founded in 2019 by experts in Banking, Supply Chain, and IT, FinAGG swiftly became one of the leading innovators in the MSME Cash Flow financing space. Pioneering the use of OCEN and GST Sahay for supply chain financing, it stands among the few completing both RBI and IFSCA sandboxes. Integrated with India Stack’s Aadhar, GSTN, UPI, NACH, etc., the platform ensures lenders access quick and seamless growth capital. Their advanced underwriting engine maintains NPA levels well below industry benchmarks. Since 2020, they’ve onboarded major consumer brands, currently collaborating with 25+ recognized names, including leading banks, NBFCs, and entities supporting MSME development in India.
About FinAGG Technologies.
FinAGG is a FinTech company that provides working capital solutions to MSME from the convenience of their home. They utilise the digital infrastructure of India to onboard and underwrite any client. Further their intelligent Lender-Borrower matching module makes sure that the borrowers get matched to Lenders providing them the best Rate of Return. Apart from acting as a middleware between lenders and the borrowers, FinAGG also uses its technical prowess and understanding of the lending market to provide Loan Management and Origination Systems customised to the minutest need of Financial Institutions in India and Abroad. They are currently present in the ecosystem of the biggest private sector bank of India alongside the biggest NBFC and the only development bank created by the Government of India with the motive of promoting growth within the MSME sector. Their open source architecture and easy to use modules makes sure that all of these Financial Institutions are able to integrate FinAGG LOS/LMS into their existing ecosystem seamlessly.
