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Smartcoin secures $7mn funding to disburse loans worth $200mn

Microlending startup SmartCoin has raised an amount of $7 Mn (INR 52 Cr) in a funding round led by LGT Lightstone Aspada. 

LGT Lightstone Aspada, Unicorn Ventures and Accion Venture Lab participated in this particular round as this is Unicorn India Ventures’ third investment in SmartCoin.

Microlending startup SmartCoin has raised an amount of $7 Mn (INR 52 Cr) in a funding round led by LGT Lightstone Aspada. 

The company’s existing investors Unicorn India Ventures and Accion Venture Lab also took active participation in the round.

Unitus Capital played a role as a financial partner for this transaction. 

Moreover SmartCoin is planning to utilize this funding to extend its loan book to another 10 Mn users over the next year , serving INR 1,500 Cr ($200 Mn). 

Previous to this, SmartCOin had raised an amount of $2mn in pre-series A funding round led by an unrevealed Chinese venture fund. 

US-based Accion Venture Lab, Unicorn India Ventures and Mumbai-based fintech accelerator ISME ACE also took an active participation in this funding round held back in the year 2018.

Also the startup raised an unrevealed amount of seed funding from Mumbai-based Unicorn India Ventures and other angel investors in the month of April 2017.

Founded in the month of January 2016 by IIT/IIM alumni Rohit Garg, Amit Chandel, Vinay Kumar Singh, and Jayant Upadhyay, SmartCoin is a data-driven, microlending startup that trusts on artificial intelligence (AI) and machine learning (ML) tools to disburse it’s loans.

Kartik Srivatsa, managing partner, LGT Lightstone Aspada, stated that SmartCoin’s business model has the ability to provide data-driven insights in a consumer segment that is otherwise opaque and can unlock and give exposure to the means of formal credit and financial services.

SmartCoin serves small-ticket personal loans to micro-merchants and self-employed blue or grey collar workers, who are otherwise left out by major banks, other non-banking financial services (NBFC) and micro-lending institutions.

The Bengaluru-based company’s business model not only helps in improvement in the credit history of the customer but also allows them to get higher loans later if the initial loan is repaid back on the time appointed.

SmartCoin received its NBFC license last year and has disbursed loans worth INR 400 Cr till date.

Furthermore, Garg illuminated the fact that other financial services institutions choose to ignore the segment because of the lack of formal financial and credit histories, and that’s where SmartCoin’s AI and ML-powered risk assessment engines comes into action.

The company’s proprietary credit underwriting engine aggregates thousands of data points on the customer’s smartphone, financial transactions, device usage and app activity to build a credit score. 

Once confirmed, the loan is transferred digitally to a customer’s bank account, with documentation restricted to Aadhaar card and social media existence.

-Authored by Farheen Malik (Content Developer, Startup-Monk)

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CIN- U74999DL2019PTC347107