Shubh Loans raises $4.2 million from Saama Capital, others
Shubh Loans will use the funding from Saama Capital and others to enhance the fintech startup’s technology platform, says founder Monish Anand
Mumbai: Datasigns Technologies Pvt. Ltd, which runs fintech lending platform Shubh Loans, has raised $4.2 million in an investment led by venture capital firm Saama Capital, said Monish Anand, founder of Shubh Loans. Shubh Loans’ existing investors—SRI Capital, Beenext and Pravega Ventures—also participated in the round. The fintech startup had raised $1.6 million from these investors in September 2017.
Started in 2016, Shubh Loans is an app-based lender providing loans largely to blue-collar employees with annual incomes of ₹ 1.5 lakh to ₹ 4.5 lakh. It generates a free credit report for users to study and obtain a loan accordingly. The digital lender focuses on lower-income groups, provides vernacular language support. The startup’s average loan size currently stands at around ₹ 68,000, said Anand. The funds raised would be used to enhance the firm’s technology platform, said Anand.
“We are an asset-light model. We don’t lend on our books. We have partnered with nine banks and NBFCs. The capital will be used to spruce up our technology and to build our data science team,” he said.
Earlier this month, Shubh Loans announced that it had appointed Oriol Mirosa, a data scientist and former assistant professor of Sociology and Global Studies at the University of Wisconsin-Milwaukee as their chief data scientist and Venkat Srinivasan, a former head of lending with UK-based fintech lender Monzo, as the head of lending.
“The end use of our loans is generally for non-discretionary spending such as medical emergencies, education, managing the house or rental deposits. We are more comfortable to give loans for revenue generating activities,” said Anand.
The digital lender now also plans to start providing credit to self employed people such as kirana shop owners and other small shop owners.
“We will start disbursing loans to the self employed segment from September. So far, we were doing it through partnerships with other startups, lending to people such as beauticians, carpenters, etc. listed as service providers on their platforms, but now we want to tap the open market,” said Anand.
Shubh Loans disbursed ₹ 35 crore in the financial year 2017-18 and is targeting to cross ₹ 150 crore of lending this financial year. “We are seeing 1,400-1,500 loan applications on an average per day,” said Anand. Shubh Loans is also planning to apply for an NBFC licence, which will help the startup to co-lend with its partners, he added.