New Delhi-based financial technology start-up IndiaLends has raised an undisclosed amount in a pre-Series A round led by DSG Consumer Partners and angel investors including Siddharth Parekh.
Founded in March this year by two former managers of American financial services firm Capital One, Gaurav Chopra and Mayank Kachhwaha, IndiaLends aims to provide credit scoring rate for large sections of population which include those who are not covered by CIBIL (Credit Information Bureau Ltd).
Chopra, an alumni of London School of Business and Delhi's St. Stephen's College and Kachhwala, an IIT Madras graduate, have gained small business credit experience while working with Capital One.
IndiaLends currently works with a number of non-banking finance companies including Bajaj Capital.
"In India, organised lending is available only to a lucky few â€“ mainly those with high CIBIL scores. The remaining borrowers are at the mercy of unorganised lenders and loan sharks, and end up paying outrageously high interest rates. We are here to change that and help both borrowers and lenders make better credit decisions," said Chopra.
The founders said the company helped assess risk for over 1,500 customers and facilitated loans for 200 of them. With this investment, the company will expand to other cities, including Mumbai and Bangalore.
As a credit underwriting and analytics platform for unsecured consumer lending, IndiaLends is available on both the web and mobile. The company said it uses proprietary algorithms to connect borrowers with the right financial institutions. It also provides data analytics and risk scoring services along with a loan management platform to financial institutions.
"We believe that IndiaLends has the opportunity to transform an important part of the financial services infrastructure. This will reduce the cost, provide a better mechanism to price risk, reduce time to assess credit and provide credit for the first time to many individuals who would not otherwise be able to access the formal credit channels," said Deepak Shahdadpuri, managing director, DSG Consumer Partners which led this round of investment.
DSG Consumer Partners has previously funded ventures such as Sula Wines, Mswipe, Veeba Food Services, ZipDial and Oyo Rooms. The other investor Siddharth Parekh, senior partner of private equity firm Paragon Partners who is younger son of HDFC chairman Deepak Parekh, has invested in his personal capacity.