The funding has been raised against issuance of non-convertible debentures (NCDs), a type of debt security, to Anicut Capital, a Chennai-based alternative asset management firm.
Lendingkart will use these funds to expand its loan book and expand to more regions in India.
In June 2016, the company raised $32 million in series B round of debt plus equity funding led by Betelsmann India Investment. The company is also backed by Darrin Capital Management, Mayfield India and Saama Capital.
Founded in 2014 by Harshvardhan Lunia and Mukul Sachan, Lendingkart Group includes Lendingkart Technologies Pvt. Ltd. that has built the technology software for credit risk analysis, and a non-banking financial company (NBFC) Lendingkart Finance that underwrites the loans.
“The latest round of NCD will further bolster our loan book and enable us to serve the credit needs of many more SMEs…We look forward to leverage Anicut’s rich experience in banking and small business financing in times to come.” said Lunia in a statement.
It underwrites working capital loans online to SMEs, which have an annual turnover of Rs12 lakh to Rs1-1.5 crore. On an average, these SMEs are lent Rs5.5-6 lakh at an annualized interest rate ranging between 16% to 24%, for a duration of six to 12 months. Lendingkart claims to have a loan application approval rate of 22-23%, Mint reported in December 2016.
Till December 2016, Lendingkart claimed to have disbursed 7,000 loans to SMEs in over 450 cities since its inception. It aims to cross 10,000 loans covering over 800 cities by June 2017. In addition, Lunia had also said that the company is launching its credit risk analytics software as a service for other financial institutions in 2017.
Founded by Ashvin Chadha and IAS Balamurugan, Anicut Capital is in the process of final closing its Rs300 crore fund by September 2017.
Since its first close in August 2016, Anicut has committed capital of over Rs110 crore across six investments. Chadha and Balamurugan have lent over Rs500 crore to over 70 companies in last five years, according to the statement.