Sachin Bansal’s Navi Finserv raises $38 million from JP Morgan in securitisation deal

Sachin Bansal

Sachin Bansal’s fintech venture Navi Finserv has raised $38 million (around Rs 320 crore) from multinational financial services firm JP Morgan in a securitisation deal. This will help the company to accelerate digital lending, it said in a media statement.

This is one of the first such securitisation deals investment bank JP Morgan has done in India with a Pass-Through Certificate (PTC) transaction in the personal loans space. The PTC makes the holder eligible to receive interest payments.

According to Navi, the transaction will be backed by a pool of unsecured personal loans, originated and serviced by Navi Finserv. The company said that digital lending is expected to comprise around 60 percent of the fintech market.

Navi had raised Rs 150 crore in May through private NCD (non-convertible debentures), and Rs 525 crore from public NCD in March.

“This deal serves as a substantial endorsement of the high quality of our loan portfolio and the sustained growth that Navi has been able to achieve in the past few years. We look forward to strengthening our relationship with JP Morgan even further in the future,” said Bansal, executive chairman and CEO of Navi Finserv.

Navi said that the country is seeing rapid growth in digital lending fuelled by increasing smartphone penetration, internet usage, and the need for faster and more convenient loan disbursals. It added that Navi will be able to capitalise on this growth.

“This transaction marks our entry into the high-growth digital lending sector in India and is aligned with our firm-wide commitment to support the innovation economy. We are deepening our engagement with multiple companies in this space in India and providing them with capital raising and financial solutions, including liquidity and risk management,” said Kaustubh Kulkarni, senior country officer for India and vice-chair for Asia Pacific at JP Morgan.

Navi has grown its UPI payments 12 times in the last three months, helped by the handsome cashback rewards the company has been offering.