Consumer lending platform EarlySalary has secured $110 million in funding. The company will use the money to expand its operations over the following 24 months.
EarlySalary, a consumer loan platform, secured $110 million at a $300 million valuation in its biggest investment round, headed by TPG’s The Rise Fund and Norwest Venture Partners.
The Series D was a combination of primary and secondary share sales, with previous investor Piramal Capital & Housing Finance Limited investing. The profits of the crowdfunding will be used to scale the company’s operations over the following 24 months.
EarlySalary, founded in 2015 in Pune by Ashish Goyal and Akshay Mehrotra, offers working professionals loans of up to Rs 5 lakh. Before starting EarlySalary, Goyal was the Chief Investment Officer at Bajaj Allianz General Insurance, while Mehrotra was the Chief Marketing Officer of retail chains Big Bazaar and Policybazaar.
EarlySalary provides its client segment with Buy Now Pay Later (BNPL) services for education, health, and consumer product finance. It reported that it has given roughly 2.8 million loans totaling Rs 7,500 crore.
Mehrotra, the startup’s CEO, stated, “The money will not only help us develop our cash business, but it will also allow us to establish a variety of skills that will allow us to service a bigger proportion of clients more effectively.
We are confident in our capacity to continue developing and achieve 10x customer growth.”
In 2019, the firm secured $34 million from Eight Roads, Chiratae Ventures, Piramal Capital & Housing Finance Limited, and angel investors. EarlySalary has strengthened its management team over the previous six months by hiring important professionals in risk, sales, treasury, and other areas. The company’s footprint has grown from 18 to over 150 places, and its client base has grown to 12 million app downloads and about one million consumers.
This follows the Reserve Bank of India’s (RBI) June 20 clarification to fintechs that loading credit lines into prepaid payment instruments (PPIs) such as prepaid cards and wallets is illegal. Following the explanation, EarlySalary ceased loan issuing using its cards.
On August 10, the RBI also established 12 guidelines for digital lending. According to the rules, loan payments and repayments shall be made solely to and from the bank accounts of the lender and the customer, with no pass-through or pool account of the lending service provider (LSP) or any third party.
According to EarlySalary, “EarlySalary feels that the ecosystem is also offering an inventive and constructive atmosphere to increase its digital footprint and digital means of banking with the new digital guidelines issued by the RBI. EarlySalary intends to grow its activities across sectors and reach millions of clients.”