Mumbai: A new player in the micro-finance space, Equitas, will raise up to Rs50 crore as second round of funding through private equity to expand its branch network in southern India.
“For our second round of equity funding we are in discussion with private equity players. We hope to raise $12.5 million (about Rs50 crore) in the next two months,” Equitas managing director P N Vasudevan told PTI.
The promoters have additonally committed a sum of Rs7 crore to be invested over the next three months, he added. Launched in December last year, Equitas has the distinction of being a micro-finance institution with the largest startup equity capital of Rs13.5 crore.
In just four months of operation, the company has opened 15 branches, 10 in Chennai and five in Tricy. It has a base of 25,000 clients and an outstanding portfolio of Rs25 crore. “By the end of the year we should have 100 branches and a client base of 5,00,000 with an outstanding portfolio of Rs400 crore” Vasudevan said.
Equitas expects to have a strong presence in southern India in two years of its operations and from the third year, it plans to start expanding in the northern part of the country.
To keep operational cost low, the company has centralized all data entry operations. Unlike the costly handheld machines used by some MFI, Equitas uses a unique pre-printed stickers, which are issued as receipts against fortnightly payments made by customers.