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EarlySalary raises $110 million in Series D round, valued at $300 million

The company plans to use proceeds to scale its business in the next 24 months.

August 30, 2022 / 10:15 AM IST

Consumer lending platform EarlySalary raised $110 million at a valuation of $300 million in its largest funding round, led by TPG’s The Rise Fund and Norwest Venture Partners.

The Series D was a mix of primary and secondary share sale and saw investment from existing investor Piramal Capital & Housing Finance Limited. The company plans to use the proceeds of the fundraise to scale its business in the next 24 months.

Founded in Pune in 2015 by Ashish Goyal and Akshay Mehrotra, EarlySalary provides lending solutions of up to Rs 5 lakh to working professionals. While Goyal served as the Chief Investment Officer at Bajaj Allianz General Insurance before founding EarlySalary, Mehrotra was the Chief Marketing Officer at retail chain Big Bazaar and Policybazaar.

EarlySalary offers Buy Now Pay Later (BNPL) services to its customer segment for education, health and consumer product financing. It said it has disbursed nearly 2.8 million loans worth Rs 7,500 crore.

Mehrotra, CEO of the startup, said, "The funding will not only help us in expanding our cash business but also build an array of capabilities to efficiently serve a larger segment of customers. We are confident in our ability to keep innovating and achieving 10x large growth in our customer base."

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The company's last fundraise was in 2019 when it had raised $34 million from Eight Roads, Chiratae Ventures, Piramal Capital & Housing Finance Limited and angel investors.

In the last six months, EarlySalary has added key executives across risk, sales, treasury and other functions to strengthen its management team. The company has expanded its presence from 18 to over 150 cities and increased its customer base to 12 million app downloads with approximately one million customers.

This comes in the wake of a June 20 clarification by Reserve Bank of India (RBI) to fintechs that loading of credit lines into prepaid payment instruments (PPIs) like prepaid cards and wallets is prohibited. After the clarification, EarlySalary suspended loan issuance through its cards.

RBI also approved 12 guidelines on digital lending on August 10. As per the norms, disbursal of loans and repayments should only be done to and from bank accounts of lenders and the consumer without any pass-through or pool account of the lending service provider (LSP) or any third party.

"With the recent digital guidelines by RBI, EarlySalary believes that the ecosystem is also enabling an innovative and constructive environment to grow its digital footprint and digital way of banking. EarlySalary aims to expand operations across verticals and targets reaching millions of customers," EarlySalary said.

 
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Moneycontrol News
first published: Aug 30, 2022 10:15 am
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