Fintech startup CredRight has successfully raised INR 78 Cr ($9.7 Mn) in a funding round that combines both equity and debt financing. This move highlights the growing interest in the startup’s mission to bridge the credit gap for Micro, Small and Medium Enterprises (MSMEs), particularly in Tier III and IV towns.
Strong Backing from Prominent Investors
The equity portion of the funding was spearheaded by the Michael & Susan Dell Foundation. Joining forces with this lead investor were other notable names in the investment sphere. Thus, including YourNest, Spearhead Capital, 9Unicorns, and AccionVenture Lab. Notably, the debt funding component was contributed by financial entities such as Blacksoil, Caspian Debt, RevX Capital, and Westen Capital.
CredRight’s Vision and Mission
Established in 2016 by Neeraj Bansal and Vineet Jawa, CredRight is headquartered in Hyderabad and aspires to bridge the credit divide for MSMEs in underserved towns. The startup aims to utilize the secured funding to expand its footprint. Into new territories and bolster its technology infrastructure, thereby solidifying its position in the sector.
CredRight’s Unique Approach to Lending
Bansal, one of the cofounders, expressed enthusiasm for the fundraise, highlighting the startup’s impressive track record. He emphasized CredRight’s commitment to serve nano enterprises and its ability to provide essential loans while ensuring profitability. The startup’s innovative approach combines a digital platform with on-ground presence, enabling it to extend financial support to remote areas.
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Addressing the Credit Gap in India’s MSME Landscape
With the Reserve Bank of India (RBI) indicating that only 10% of MSMEs have access to formal financing. CredRight plays a pivotal role in filling this critical void. The startup’s model effectively connects small business owners with lenders, eradicating the need for reliance on high-interest money lenders. Moreover, CredRight aims to address the staggering $500 Bn credit demand shortfall from approximately 63 Mn Indian MSMEs.
CredRight’s recent funding success underscores the significance of its mission in India’s MSME landscape. By securing both equity and debt funding, the startup is poised to extend its reach, leverage its unique approach. And contribute to the growth of small businesses across underserved regions. As India’s fintech ecosystem evolves and the market expands. CredRight’s endeavors align with the broader trends driving financial inclusion and innovation in the country.
