Indian fintech firm Aye Finance has entered into definitive agreements for INR 250 crores ($30 million) in Series G funding, led by Singapore’s ABC Impact, the leading Pan-Asia impact investor backed by Temasek and Temasek Trust.
Aye Finance said in a statement on Friday that this transaction marks the first investment made from ABC Impact’s Fund II. ABC Impact has a growing asset under management (AUM) of over $850 million.
This round also saw participation from British International Investment, the United Kingdom’s development finance institution and impact investor who led Aye’s Series F round of INR 310 Crores in December 2023.
The deal completion is subject to completion of standard conditions precedent.
With this round, Aye’s equity raise totals INR 1250 Crores.
“This capital infusion will enable us to scale our operations and enhance our ability to deliver value to our target segment of micro enterprises,” said Sanjay Sharma, Founder and Managing Director of Aye Finance.
“We have been fortunate to have stellar names from the industry partner with us in our mission to enable financial inclusion of the underserved segment right since 2014,
“We are delighted to partner with ABC Impact in this round and look forward to maximizing impact,” he added.
Aye is a small-ticket lender in micro, small and medium enterprises (MSME) lending landscape providing working capital loans to micro-enterprises.
The company is committed to easing access to credit for small businesses and has made significant strides in enabling the financial inclusion of this often-overlooked segment.
Its underwriting approach focuses on evaluating cash flows, enabling a better understanding of the financial health of businesses it supports.
With a national presence spanning over 478 branches, Aye has diversified its product offerings to cater to the diverse needs of India’s rapidly growing MSME customer segment across various industries and clusters.
“India is a country of micro-entrepreneurs. However, this important segment of the economy is significantly underserved by formal credit,
“Our partnership with Aye Finance will support these micro-entrepreneurs with better access to credit so that they can grow their businesses and realize their full potential. We are encouraged by the team’s strong commitment to customer centricity, disciplined underwriting, and solid operational performance,” said Sugandhi Matta, Chief Impact Officer of ABC Impact.
He noted that their focused use of technology has enabled scalable growth across the country, positioning them as a notable lender for their target segment.
Founded in 2019, ABC Impact invests in companies that drive positive change by addressing the world’s most pressing challenges such as climate change, resource scarcity, and deepening inequality.
A division of Singapore-based global asset management firm Temasek Trust Asset Management, the fund focuses on innovative solutions that drive financial and digital inclusion, better health and education, climate and water solutions, as well as sustainable food and agriculture.
It is a signatory of the Operating Principles for Impact Management and the United Nations-supported Principles for Responsible Investment.