FinAGG Technologies, an India-based fintech firm, 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, FinAGG said in a statement on Thursday.

Additionally, FinAGG secured capital from Gray Matter Capital through Non-Convertible Debentures (NCDs) to empower women entrepreneurs financially.

According to the statement, the latest funds infusion will be directed towards expanding FinAGG’s offline and online presence, enhancing global outreach, and driving product innovation.

“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,” said Nipun Kohli, Co-Founder and Chief Executive Officer of FinAGG Technologies.

According to him, the inclusion of BlueOrchard, a leader in climate-based impact programs, enhances the firm’s ability to promote climate insurance penetration to its client, Tata Capital — an influential NBFC in India.

This strategic collaboration also positions the firm to elevate its business operations to unprecedented levels, he said.

Additionally, it said the involvement of SIDBI, a development bank owned by the Government of India, is instrumental in fostering the growth of GST Sahay by providing access to cost-effective 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,” he said.

He also said these new features will help the firm looks at borrowers under a completely different light and make underwriting in this space more meaningful.

In the context of India’s micro, small and medium enterprises (MSME) landscape, where approximately 63 million micro, small, and medium-sized enterprises contribute significantly to the gross domestic product (GDP) and employment, FinAGG said the firm addresses the pressing issue of limited credit access for these enterprises.

According to FinAGG, the supply chain finance gap in India is estimated at INR 60,000 Crores ($7.2 billion), with FinAGG having disbursed over INR 5230+ Crores ($630+ million) to over 85,000 MSMEs to date.

Notably, around 20 percent of these enterprises are led by women entrepreneurs, fostering annual sales growth of 22 percent and promoting financial awareness and inclusion.

“We’ve made a significant impact, reaching over 85,000 borrowers in 100 Tier 1 and Tier 2 cities,” said Srini Ramki, Co-founder and Chief Technology Officer of FinAGG Technologies.

According to him, the funds secured in this round are pivotal for the firm’s 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,” he added.

Additionally, FinAGG’s Quick Cash Flow platform, having completed the RBI Sandbox for MSME Lending in November 2023, leverages technology to offer low-cost loans seamlessly.

“Initiating a strategic investment drive, we selectively invest in businesses aligned with our goals,” said Rajiv Sabharwal, the Managing Director and; Chief Executive Officer of Tata Capital.

According to him, the firm’s existing partnership with FinAgg in the small and medium-sized enterprise (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,” he added.

Mahesh Joshi, Head of Private Equity Investments (Asia) at BlueOrchard, said that FinAGG’s innovative model employs technology to seamlessly provide cost-effective loans to MSMEs.

“Rapidly becoming a premier partner to blue-chip companies in fast-moving consumer goods (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,” he added.

Founded in 2019, FinAGG is a FinTech company that provides working capital solutions to MSME.

Spearheading the utilization of OCEN and GST Sahay for supply chain financing, it stands as one of the select few successfully navigating both RBI and IFSCA sandboxes.

Integrated with India Stack’s Aadhar, GSTN, UPI, NACH, and more, the platform ensures lenders prompt access to efficient growth capital.

Since 2020, FinAGG has successfully onboarded major consumer brands, fostering collaborations with over 25 recognized entities, including leading banks, non-banking financial companies (NBFCs), and organizations dedicated to fostering MSME development in India.

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