Arthan Finance Pvt Ltd, a non-banking financial company which provides loans to self-employed micro-entrepreneurs, said Monday it raised Rs 50 crore (around $6 million) in its Series B funding round.
The company raised the funds from Incofin India Progress Fund and returning investor Michael & Susan Dell Foundation (MSDF), the nonprofit arm of the family behind tech giant Dell.
Arthan Finance plans to use the fresh capital to fund its expansion and technological progress, it said in a release. This funding round will help the company grow its assets under management, expand its geographic footprint, and invest in underwriting systems, the company said.
The lender said it believes technological enhancements will improve its ability to assess credit risk and tailor financial solutions for the unorganised sector, which will further streamline operations and better customer experience.
“This funding is crucial for our next phase of growth. We are committed to improving our technological capabilities and expanding our reach to serve more micro and small enterprises in underserved regions,” said Kunal Mehta, founder and director of Arthan Finance.
To date, Arthan Finance has raised approximately Rs 83 crore. In its previous funding round, it raised capital from founders, angel investors, and the MSDF.
Arthan Finance currently operates in Maharashtra, Odisha, Andhra Pradesh, and Telangana. It provides growth capital to self-employed nano and micro enterprises in Tier II, III, and IV cities. It has disbursed over Rs 500 crore to more than 20,000 borrowers so far, with loan amounts ranging from Rs 2,000 to Rs 20 lakh.
“Arthan Finance’s innovative approach combines operational excellence, community presence through phygital outreach and cutting-edge technology. Its AI and ML-based underwriting ensures efficient risk discovery and loan disbursement, catering to an acutely underbanked population of more than 11 million nano enterprises with an estimated credit demand of more than $25 billion,” said Geeta Goel, India Country Director at the MSDF