Indian SME lending platform NeoGrowth posts profit in FY’19, revenues uo 25 %

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Dhruv Khaitan, Founder, NeoGrowth

Digital SME lending platform Neogrowth Credit Private Limited has turned profitable. The Mumbai-based non-banking financial company (NBFC) has posted a profit of INR 43 million in the financial year 2018-19 as against a loss of INR 235 million in the year ago period. The company had last posted profits in 2017 at INR 57 million after losses for two consecutive years.

The company’s revenues for the Indian financial year 2018-19 stood at INR 3 billion, up 25 % from the last financial year, as per its RoC (Registrar of Companies) filings that was accessed on business intelligence platform Tofler.

Started in 2012 by Dhruv Khaitan and Piyush Khaitan, Neogrowth is among the few digital lenders in India that are profitable. The company has raised a total of USD 16 million in 2017 in a new round of funding from IIFL Wealth Management’s Seed Venture Fund. Its existing investors Omidyar Network, Khosla Impact and Aspada also participated in the round. Further it raised a Series C funding of USD 47 million in FY 2018. In total, it has raised around USD 77 million since its inception.

The company, registered with the Reserve Bank of India (RBI), helps Indian merchants in solving their working capital issues. The company provides short term loans in the range of USD 1470 (INR 0.1 million) to USD 1,10,000 (INR 7.5 billion) for 18 to 36 months to small retailers and merchants selling on ecommerce platforms.

The company differentiates itself from other digital SME lenders in a way that NeoGrowth provides Point of Sale (PoS) based funding wherein the company uses PoS sales to data as an analytical tool to underwrite the loans. It also offers vendor finance to the suppliers of large corporates based on monthly receipts.

NeoGrowth has developed a robust lending platform using technology, automation and analytics to offer lending products. Besides the technology also helps reduce TAT (turnaround time) for loan processing in a sector that is booming but is deprived of credit due to unavailability of credit score.

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