Ecommerce major Flipkart co-founder Sachin Bansal and Poonawalla Finance have infused Rs 75 crore into U Gro Capital, a technology-focused small business lending platform.
The investment was made through securitisation and debt issues.
Mumbai-based U Gro Capital has raised Rs 50 crore from Bansal through a non-convertible debenture issue and Rs 25 crore from Poonawalla Finance through securitisation issue, said the non-banking finance company in an official statement.
“While we continue to have strong equity in our business and sufficient liquidity, we want to establish our ability to raise different forms of liability from diverse sources. We would like all stakeholders to gradually draw comfort with our high degree of governance, quality of underwriting and depth of our specialised underwriting,” said Shachindra Nath founder of U Gro Capital.
U Gro Capital had earlier raised $140 million from global private equity firms such as NewQuest Capital Partners, ADV Partners, Hongkong-based PAG and Samena Capital and public market investors such as Abakkus Investing, PNB Metlife and multiple family offices.
Founded in 2017, the company started loan disbursals in January 2019. So far, it has disbursed more than Rs 600 crores in debt to over 6,000 small businesses in India.
The company focuses on lending to eight sectors. It claims to use specialised sectoral statistical scorecards, deep sub-sectoral underwriting algorithms and a highly integrated technology platform that delivers an in-principle credit approval within 60 minutes.
U Gro founder Shachindra Nath was one of the founding members of Religare Group. While working as Religare Group’s chief executive officer in 2010, he was involved in the initial public offering (IPO) of Religare Enterprises.
Other than U Gro, Bansal has investments in Bengaluru-based NBFC Chaitanya India Fin Credit and digital lending platform Kissht. He is also said to have invested Altico Capital India, IndoStar Capital and Piramal Enterprises.
Bansal’s investment in NBFCs comes at a time when the sector is facing severe liquidity crisis due to the ongoing issues at systemically important companies like Infrastructure Leasing & Financial Services and Dewan Housing Finance Corporation.