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NEW DELHI: Corporate card provider Karbon on Tuesday said it has raised ₹55 crore in a debt financing round from Northern Arc Capital, UC Inclusive Credit Private Limited (“UCIC“) and Oxyzo Financial Services Pvt. Ltd. The company will use the funds to enable startups and Small and Medium Businesses (SMBs) with corporate credit cards that they can use as flexible capital for business growth.
Karbon claimed it currently provides corporate cards and expense management solutions to over 2,000 startups and SMBs.
The Bengaluru-based company has raised about $32 million in equity from Ycombinator, Ramp and Olive Tree Capital, among others, and this is Karbon’s first debt round. UCIC, incubated by Unitus Capital, is a non-banking financial company registered with the Reserve Bank of India, while Oxyzo is the lending arm of OfBusiness, backed by Softbank.
“The debt round from leading financing firms like Northern Arc Capital assumes significance as it strengthens the trust factor that Karbon has built over the past three years amongst startups and SMBs. Also, raising debt is important at this point for Karbon considering the high growth it has witnessed in just one year post Covid," the company said in its statement.
Founded in 2019 by Kartik Jain, Pei-fu Hsieh, Amit Jangir and Sunil Kumar, Karbon is a corporate payment platform and an upcoming neobank for small businesses, corporates and startups. It provides Visa-issued corporate cards, both in the virtual and physical form and enables the finance team to control and track expenses for the whole company.
Karbon card carries four key offerings - credit of up to ₹25 lakh in cash with no personal guarantee or fixed deposits, seamless payments transactions through corporate cards to its customers, rewards specific to the startups' requirements, such as AWS credits at 12% discount or SaaS products, and expense management through WhatsApp.
“We believe that partnering with these stalwarts goes a long way in consolidating our credibility and presence in the new-age banking ecosystem. We will be allocating these funds to expand our customer base and become the preferred neo-banking partner for all start-ups and SMBs in India," said co-founder Jain.
Karbon said it has recently launched a banking product for such small businesses called Karbon PayOut to make vendor and salary payments easier and faster.
