Exclusive: Debt Resolving Startup Credgenics In Talks To Raise $25Mn In Series A Round

The startup is in talks to raise the funding from WestBridge Capital and Tanglin Venture Partners, pegging the valuation at $100 million

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New Delhi-based debt resolving startup Credgenics is in talks to raise its Series A round worth $25 million. The startup is in talks to raise funding from WestBridge Capital and Tanglin Venture Partners. The latest funding will value the startup at over $100 million.

Credgenics
(LtoR) Anand Agrawal, Mayank Khera, Rishabh Goel

In an interaction with Entrepreneur India, Rishabh Goel, chief executive officer and co-founder of Credgenics confirmed the same.

When asked about the utilization of the funds, Goel said the capital infusion will boost efforts on R&D, expand overseas outside India and hire experienced professionals across functions and industries for seamless service delivery to their clients, while ensuring newer and improved product features.

The startup had earlier in November last year raised INR 27 crore in its pre-Series A round led by Accel Partners, DMI Alternatives fund with participation from existing investors Titan Capital, among others.

An IIT-Delhi alumnus, Goel while working for Blackrock, realized that the country’s recovery process is old and taxing, further burdening the banks with NPAs. After two years of research, he formulated the idea of Gredgenics along with another IIT-Delhi alumni Anand Agarwal, and advocate Mayank Khera.

“In India, where the credit demand of more than $600 billion is being met through informal sources, digital lending is set to cross the $100 billion mark by the end of 2023. The increased disbursement of credit has also led to a spike in the NPAs for both NBFCs and banks,” Goel added. 

Founded in 2018, Credgenics is a debt resolution platform that leverages technology, automation intelligence and optimal legal routes to expedite debt resolution. The startup boasts of a huge network of freelance dispute resolution specialists who independently assist NBFCs, banks, ARCs and fintech players, settle disputes amicably with their borrowers.

The platform offers customized collection strategies and recommends optimal legal routes to facilitate faster resolution of stressed assets which helps creditors efficiently improve their NPA, geographic reach, and customer on-boarding.

Asking on the role of machine learning (ML) and artificial intelligence on recovering bad loan, Goel said, “On the front of the collection, ML is helping us predict recovery chances based on multiple parameters including defaulter’s personality information, demographics, language, EMI payments, and communication follow-up trends. Our proprietary model is reducing the debt collection cost making the unit economics more valuable for lenders by redefining the buckets basis recovery chance, delinquency days, and different communication channels; hence increasing overall collection and reducing the expected resolution time.”

At present, the startup manages over INR 580 crore of debt on its platform and has helped it’s clients improve their resolution rates by 15- 20 per cent and has resulted in a significant reduction in overall resolution time.

The startup provides two options to its customers. In the first option, it allows users to use the SaaS platform and manage the data and the recovery thus allowing the creditor to pay for the SaaS platform and use the startup’s API data integration features, manage the data on their own and decide the next course of action. The second option is an end-to-end recovery that offers the SaaS platform, automated communication channels, along with legal services.

Credgenics has now become a team of over 80 members with Its legal team consisting of more than 8 in-house lawyers including Mayank, as the leader and mentor, and collaborating with over 2200 lawyers.

The ongoing pandemic has wreaked havoc in businesses across the sectors forcing the central bank to provide a respite in the form of a moratorium to its citizens in the aftermath of three months long lockdown resulting in the crippling of the economy in 2020.  Though the move was welcomed by various sectors including the common man, it has only stressed the banks with ever-increasing NPAs.

Goel believes that there has always been a demand for a full-stack resolution platform to recover bad loans, but at present, the need for such a platform has only increased further as the lending has grown stupendously along with the defaulting rates.

“With the economy still in the vulnerable phase owing to the waves of the pandemic, the debt recovery solutions and predictive analysis our platform provides have already proven beneficiary, and will stand the test of time,” Goel added.