Startups Money

BCCL's Brand Capital invests $1.5 mn in Faircent

11 Aug, 2016

Online peer-to-peer (P2P) lending platform Faircent, operated by Gurgaon-based Fairassets Technologies India Pvt. Ltd, has raised $1.5 million from Brand Capital, the ad-for-equity investment arm of Bennett Coleman & Co (BCCL).

"Our association with Brand Capital would help us accelerate our brand building efforts to reach more borrowers and lenders. More people need to be made aware of the alternative investment opportunity that we provide and this will help us take a step closer to provide easier and cheaper access to the credit market in India," said Rajat Gandhi, founder and CEO of Faircent, in a statement.

Faircent will use the funds to buy inventory in radio, TV, online and print properties of the Times of India group, Gandhi told TechCircle.in.

Founded in 2013 by Gandhi, Vinay Mathews and Nitin Gupta, Faircent connects borrowers and lenders. The company's technology enables credit appraisal and borrower rating. It caters to retail and business loans and claims to have disbursed Rs 6.5 crore since inception. It has over 6,000 and 26,000 registered lenders and borrowers, respectively.

Last month, it appointed former Standard Chartered executive Shivam Gupta as chief risk officer and former Dassault Systemes and Oracle executive Karun Thareja as head of marketing.

The firm recently formed an alliance with TransUnion that provides credit information. It also tied up with Yodlee which offers an account aggregation service that allows users to see credit card, bank and investment accounts on a single screen.

In May this year, financial services firm JM Financial Ltd, through its subsidiary JM Financial Products Ltd, picked a 9.84% stake in Faircent.

In October 2015, Faircent raised an undisclosed amount of funding from Aarin Capital Partners, which is run by former Infosys CFO TV Mohandas Pai and Manipal Group's Ranjan Pai (not related to each other).

In January 2015, Faircent secured an undisclosed amount in funding from Devesh Sachdev and Ashish Tiwari, promoters of Fusion Microfinance Pvt. Ltd.

Of late, startups in the fintech space have seen considerable activity. In June, Mumbai-based ePaylater.in raised $2 million (Rs 13.3 crore) in a seed round of funding from three high-net-worth individuals.

In May, online investment platform Goalwise raised $1 million from high-net-worth individuals while online P2P lending platform i2ifunding secured Rs 2 crore from a group of angel investors.

In April, digital payments firm TranServ Pvt. Ltd raised $15 million in its Series C round of investment led by venture capital fund IDFC SPICE and consumer electronics maker Micromax Informatics Ltd. The same month, online lending marketplace Deal4Loans raised an undisclosed amount of funding from a bunch of investors.

At a recent summit on financial technology organised by VCCircle, panellists said it will take another three to five years for a billion-dollar fintech company to emerge in India as the sector will take a profit-first and valuation-later approach, unlike e-commerce firms. Indian fintech firms will have a lot to learn from China, instead of the US, because of similar demographic opportunities and challenges. They said a successful business model is yet to emerge as companies are currently experimenting with marketplace, bidding process and intermediary models.

Last month, the Reserve Bank of India (RBI) set up a panel to examine issues concerning digital banking and financial technology in the country. Besides recent innovations in the fintech sector, the panel will assess the opportunities and risks arising as a result of digitisation. It will also look at how regulators in many other parts of the world have adapted technology in the fintech space.

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