NeoGrowth, a non-banking finance company with a focus on micro, small and medium enterprises (MSMEs), on Tuesday said it has secured debt funding of $10 million (around Rs 81 crore) from US-based global investment firm MicroVest Capital Management.
The investment comes one month after NeoGrowth had raised Rs 300 crore (around $36.2 million) in a Series D equity round led by Dutch development bank FMO and existing investors.
The investment will help Neogrowth extend financing to small businesses while helping it get required growth capital, said the company backed by Omidyar Network, Lightrock, Khosla Impact, Accion Frontier Inclusion Fund Quona Capital, IIFL Seed Ventures Fund, WestBridge Capital, and Leapfrog Investments.
Microvest is an impact investor with a 19-year history of investing in microfinance institutions and small and medium enterprises. Since its founding in 2003, Microvest has disbursed over $1 billion to over 200 financial institutions in 60 emerging and frontier countries.
NeoGrowth’s Managing Director and CEO Arun Nayyar stated: “NeoGrowth is dedicated to funding India’s small businesses by leveraging the digital payments ecosystem. This support from MicroVest will allow us to continue making a positive impact on SMEs. The funding will be used to help accelerate the growth of MSMEs and integrate them into the mainstream financing ecosystem.”
“Through this loan, we are leveraging both of our organisations’ synergies to achieve meaningful scale and contribute to the sustainable development goals,” Microvest chief executive Joshua Moraczewski said.
Neogrowth, founded by Dhruv Khaitan and Piyush Khaitan, has a decade of experience in SME lending and has served over 1,50,000 customers, disbursing over $1 billion in loans across 25 locations.
The decade-old startup offers loans to small businesses, based on underwriting of their digital transactions and cash flow to assess the health of the business. Its lending activities also focus on the financial inclusion of first-time entrepreneurs, women business owners, and underserved small businesses. It offers loans to MSMEs across multiple segments and has a presence at around 25 locations in India.
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