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BharatPe has acquired a majority stake in Trillionloans Fintech, a Mumbai-based non-banking financial company, according to three people aware of the matter.

The Delhi-based fintech company, which currently has former SBI chairman Rajnish Kumar at its helm, has secured approval from the RBI to buy out 51% in Trillionloans, one of the people cited above said.

The deal is valued at about 300 crore, the people said, requesting anonymity. Trillionloans Fintech is owned by Achal Mittal and Gautam Adukia. Both Mittal and Adukia also own a popular P2P (peer-to-peer) NBFC Liquiloans. According to the Registrar of Companies filings, Trillionloans posted a revenue of 7 crore during FY22 and 74 lakh in profits. Interestingly, at a time when several fintech entrepreneurs were struggling for the regulator’s approval to get an NBFC licence, Liquiloans founders managed to get both NBFC and P2P NBFC licences.

Achal Mittal is the son of Ajit Mittal—who spent close to two decades in middle and senior management roles at RBI and is currently on the board of Indiabulls Housing Finance Ltd.

In 2019, BharatPe failed to get an NBFC (a non-banking financial company) license 2019 to get access to a ‘low’ cost of capital– a factor that is key to a successful lending business. Post that, BharatPe partnered with Liquiloans becoming the first fintech to crack the code of creating both the demand and supply side of lending [without having its own NBFC] – all on the back of P2P. The arrangement even flouted some P2P norms. Their relationship has strengthened since then.

Mint did a detailed story on BharatPe’s lending strategy titled, ‘Inside BharatPe’s big lending rethink’.

Currently, Liquiloans also works closely with Kunal Shah-owned Cred too. Last year in August, Cred said it was investing about $10 million ( 79 crore) to pick up a minority stake in the P2P NBFC.

Although BharatPe managed to get the small finance banking licence in January 2022, in a 51:49 joint venture with Centrum Financial Services. The SFB was seen as BharatPe’s massive win within the fintech community, but currently, the payments firm has sidelined itself from getting involved in Unity Small Finance Bank (the JV in which BharatPe owns 49% and the majority stake is with Centrum).

The Sequoia-backed company “only wants to maintain its position as a ‘financial investor’ in the JV," one of the persons quoted above added.

Apart from raising $580 million in equity to date from marquee investors such as Sequoia Capital, Ribbit Capital, Insight Partners, Tiger Global, Steadview, and Coatue, among others, BharatPe (which was valued at $2.8 billion during its last fund-raise) was probably the only fintech uniquely positioned to raise massive debt at a cheaper cost.

In 2021 alone, to scale its loan book, the company raised about $84 million (close to 600 crore) in debt from the likes of ICICI Bank, Northern Arc, IIFL Wealth, and MAS Financial Services. The debt from ICICI was reportedly raised at an interest rate of less than 9%.

ABOUT THE AUTHOR
Arti Singh
Arti Singh has been a business journalist for 15 years. Over the last five years, she has closely tracked India's fintech space and written important deep-dive stores. As deputy editor, she covers the intersection of finance and tech at Mint.
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Updated: 22 Mar 2023, 12:26 AM IST
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