The four-year-old company, which uses artificial intelligence and machine learning-based underwriting engine, will use the proceeds from the latest funding round to further grow its loan book to Rs 1,500 crore, and is also targeting doubling its user base to 10 million over the next 12 months, a senior executive of the company said.
Founded in 2016 by Rohit Garg, Amit Chandel, Jayant Upadhyay and Vinay Kumar Singh, SmartCoin is an app-based micro-lending startup that offers small-ticket personal loans to micro-merchants and self-employed blue and grey-collar workers, who, they claim, are underserved by banks, other NBFCs and micro-lending institutions.
“While traditional players find it difficult to serve them owing to volatile incomes and lack of formal financial and credit histories, we have been able to harness the power of alternate data and machine learning through our proprietary AI/ML powered risk-assessment engines,” Garg, the chief executive of SmartCoin, said.
Unitus Capital acted as the financial advisor to the transaction. The company’s existing investors, Unicorn India Ventures and Accion Venture Lab, also participated in the new round, which comes almost two years after it raised $2 million from Accion’s seed-stage, fintech-focused investment arm, and a Chinese venture capital fund, whose name was not disclosed.
The company, which also received its non-banking financial company licence last year, has disbursed loans of about Rs 400 crore till date. Under its model, if borrowers repay their loans on time, they are eligible for a higher amount next time round, while also having improved credit histories.
“We are excited to back SmartCoin, one of the strongest teams in machine learning and AI in financial services. SmartCoin’s business model has the ability to provide data-driven insights in a customer segment that is otherwise opaque and can unlock means of formal credit and financial services,” Kartik Srivatsa, managing partner, LGT Lightstone Aspada, said.