Swiss impact investment firm Blue Earth Capital and Amsterdam Stock Exchange-listed Prosus Ventures and others have together invested about Rs 200 crore in Chennai-headquartered GrowXCD Finance, a startup lender to small businesses.
Blue Earth Capital led the funding round, investing Rs 105 crore, while Prosus put in Rs 70 crore, GrowXCD Finance’s founder-cum-managing director, Arjun Muralidharan, told ET.
Lok Capital, which first invested in the non-bank lender in November 2023, has raised its stake in the company with Rs 21 crore. UC Impower put in the balance Rs 4 crore. Lok Capital’s cumulative investment in GrowXCD grew to about Rs 93 crore making it the single largest shareholder.
“The capital infusion will mostly help us in expanding our portfolio and branches, besides improving the technology backbone,” Muralidharan said. “This capital will be good for the next 12-18 months of business.”
The company’s net worth grew to Rs 308 crore with the equity raise.
This is the second equity raise by GrowXCD this year. It raised Rs 50 crore in January from Lok Capital and UC Impower.
This investment reflects Blue Earth Capital’s mission to back businesses that aim to deliver both social and economic impact, said Rohan Ghose, director, private equity partnerships at the Swiss firm. It has exposure to several other Indian ventures, including Aavishkaar Capital, Arya Collateral Warehousing Services, Asian Institute of Gastroenterology and Northern Arc Investments.
GrowXCD lends to small business owners classified as micro small and marginal enterprises (MSMEs), and salaried employees in tier-II and tier-III towns of the southern states. Founded in 2022, it now has 67 branches spread across Tamil Nadu, Karnataka, Andhra Pradesh and Telangana as well as the union territory of Puducherry.
The company aims to increase its assets under management to Rs 500 crore by the end of March 2026. Its AUM now stands at Rs 300 crore.
“We plan to open 40-50 branches by March 2027. We will also explore geographical expansion in states like Madhya Pradesh, Maharashtra or maybe Uttar Pradesh.”
India’s MSMEs form the backbone of our economy yet remain significantly underserved on credit, said Gaurav Kothari, principal investor, Prosus India. “With rapid digital adoption, greater formalization and supportive government initiatives, we see a massive opportunity to build tech-led lending solutions for this segment.”
Source: www.economictimes.indiatimes.com