NEW DELHI — Indian fintech startup PhoneParLoan has raised an undisclosed quantity of funding from accelerator MOX, its co-founder Ashwin Bhambri informed DealStreetAsia.
MOX is operated by SOSV, a U.S.-based enterprise capital agency with over $700 million beneath administration. The PhoneParLoan funding marks SOSV’s second capital infusion into the startup, presently valued at $7 million.
SOSV earlier invested within the startup in January 2019, together with a slew of Japanese and Chinese language traders. Earlier than that, PhoneParLoan had obtained funding from a couple of angel traders.
Though the present funding determine is small, the funding spherical highlights India’s rising marketplace for on-line lenders that cater to salaried people.
PhoneParLoan, which accurately means a mortgage on a cellphone, doles out quick tenure microloans of 1,000 rupees to 10,000 rupees (about $14 to $140) by connecting clients to lenders primarily in tier II and III cities.
In response to estimates, there are presently as many as 300 million low- and middle-income salaried employees in India who typically discover themselves in need of money on the finish of the month and want microcredit to purchase groceries and pay payments.
The nation’s short-term credit score market, Bhambri stated, presently stands at 700 billion rupees and is predicted to develop at 14% year-on-year.
PhoneParLoan was established in 2015 beneath Millennial Card Applied sciences to deal with India’s contactless lending sector. For retail debtors, it creates a single mortgage utility that’s accepted via APIs of a number of lenders.
The lender — be it a fintech startup, nonbank finance firm or financial institution — advantages by receiving entry to a pool of consumers and all their particulars with out spending something on acquisition. PhoneParLoan additionally claims to have an alternate information credit score rating card for the new-to-credit or thin-file customers that can be utilized by a number of lenders for credit score choices.
Different startups working within the phase embody Creditbazzar.com and QuickCredit.in.
PhoneParLoan will use the newly raised funds to enhance its expertise, ramp up head depend and broaden its operation, Bhambri stated. “The concept is to cut back the friction between shoppers and lenders.”
“The profit-participating mortgage utility is sort of distinctive as it’s complementary to each the borrower and the lender,” stated Anand Kumar, a company lawyer with Pier Counsel who has personally invested within the startup. “India is the very best testing floor for such a product, [which] has international scalability.”
New Jersey-based SOSV is not any stranger to India’s burgeoning startup ecosystem. In response to media studies, it has made 20 investments in India over the previous three years and plans to clinch at the very least 15 offers over the course of this 12 months.
DealStreetAsia is a monetary information web site primarily based in Singapore centered on company funding exercise in Southeast Asia and India. Nikkei lately acquired a majority stake within the firm.