Early-to-growth stage venture capital investor Elevation Capital has led a capital infusion of Rs 150 crore ($18 million) in Vridhi Home Finance, a housing finance company co-founded by a former executive at Aavas Financiers, in its first external funding round.
The Bengaluru-based company, bootstrapped until now, will use the Series A capital to expand in northern Karnataka and Andhra Pradesh, improve its tech stack, and build its team.
Founded last year by Sunku Ram Naresh, Sandeep Arora, and Sunil Mehta, Vridhi provides loans for home needs to salaried and self-employed individuals in tier II and III cities across India.
Naresh is a former CBO at Aavas Financiers and has served at companies like Nestle, ICICI Bank, GE Money and Bajaj Finance. Arora has worked at Kotak Mahindra Bank, Dhani Financial Services and Bajaj Finserv. Mehta is a former CFO at VC firm Iron Pillar.
Vridhi received its NBFC-HFC licence (Non-Banking Financial Corporation- Housing Financial company) earlier this year. Since then, it has set up 20 branches in Karnataka and Andhra Pradesh.
“With this substantial capital infusion, we are poised to advance our mission of providing accessible housing solutions. We are steadfast in our dedication to providing affordable and secure housing options to the unserved and underserved segment," said Naresh, who is also managing director and chief executive.
Vridhi offers secured home loans at an average ticket size of Rs 6-8 lakh. The company is targeting semi-urban and rural areas of India, where exposure to formal credit services has been limited. It is collaborating with providers of loan management software and digital onboarding systems, to scale its operations.
“India’s mortgage market remains underpenetrated compared to several other emerging and developing economies at just ~11% of GDP, indicating a significant headroom to grow,” said Mridul Arora, Partner, Elevation Capital. “The Vridhi team brings unparalleled industry experience and drive to make homeownership more affordable and accessible to Indians.”
