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Lendingkart, a platform for small business loans, raises $10 mn Series A from Mayfield Fund, others

New Delhi-based
platform
Lendingkart has
raised a Series A of $10 million from Saama Capital, Mayfield Fund, Shailesh
Mehta, and Ashvin Chadha.

New Delhi-based
platform
Lendingkart has
raised a Series A of $10 million from Saama Capital, Mayfield Fund, Shailesh
Mehta, and Ashvin Chadha.

Since launching
a year ago, Lendingkart has processed loans from 50 cities and 17 states across
India. According to a TechCrunch report, the company will use its new capital
to expand into all towns and cities in India, improve its credit scoring
technology, and hire more employees.

The startup
allows businesses to apply for loans online, bypassing banks and other
traditional finance institutions. Co-founder and chief executive officer
Harshvardhan Lunia explains in the report that Lendingkart’s algorithms use
1,500 data points to score credit application. The site claims that its
application process takes just 15 minutes, with most loans approved in a few
hours and disbursed within three working days.

 “Lendingkart has enough data available to
determine a customer’s intent to pay back a loan, the quality of his product or
service, the financial health of his business, and ability to survive with
competition,” Lunia told TechCrunch. “We don’t ask the customer to fill out
large forms. We scrape this data from public and private sources and APIs.”

He added in the
report that India currently has about 30 million SMBs. While 1.6 million have
received loans from financial institutions and 600,000 get capital from sources
like friends, family, and money lenders, the vast majority of small
businesses–or 92.77 percent–have no outside financing.

The company
believes that India’s e-commerce market, which is expected to be worth $50 billion by 2020, continues to
boom, more entrepreneurs will seek working capital, and they will want to get
it quickly without filling out multiple forms.

Lendingkart
competes with firms like Capital FloatNeoGrowth, and SMEcorner, but sets itself apart by focusing on lenders who
need relatively small amounts of money and plans to add a peer-to-peer platform
similar to LendingClub.

The platforms works
with marketplaces like Flipkart and
Snapdeal to provide
capital loans to online sellers, who only have to supply bank statements and
VAT returns. Lendingkart then supplements that with information from their
stores and other sites.

In addition to
e-commerce, Lendingkart also plans to service companies that supply goods to
large corporations, online app and game developers, and offline retailers and
service providers.

“We will be
targeting all the niches in the country where secondary verified data is
available to us from third-party sources,” Lunia was quoted in the report as
saying. “So rather than bothering the borrower for document submission and
evaluation, we will extract data from his ecosystem and evaluate him.”

 

 

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