Aye Finance Raises $10 Million From responsAbility
The fund raised will be used to offer business loans to the excluded microenterprise sector to support their growth and enable their inclusion into the formal economy
Aye Finance, a lender to the micro enterprise segment, has raised $10 million of ECB (External Commercial Borrowings) from Swiss-based responsAbility Investments AG, the company that has been supporting Aye in its mission to create an inclusive India since 2017 and this is the fifth investment via debt for the fintech lender. Aye will be utilizing these additional funds to offer business loans to the excluded microenterprise sector to support their growth and enable their inclusion into the formal economy.
"We are currently witnessing a surge in credit applications from the microenterprise sector as businesses are being rebuilt post the disruptions caused by the pandemic. The support we are receiving from global impact leaders like responsAbility allows us to continue in our mission of transforming microenterprise lending in India by providing entrepreneurs customized business loans at affordable prices," said Sanjay Sharma, MD and founder of Aye Finance.
In India, there are over 60 million microenterprises and a majority of these businesses struggle to access credit from formal lending channels. Founded in 2014, Aye has been championing the cause of providing affordable business loans to this excluded segment. The lender uses its proprietary cluster based credit assessment methodology coupled with artificial intelligence algorithms to make robust risk selection even in the absence of traditional business documentation. The lender has successfully deployed this methodology and solved the credit challenges of over 4,50,000 unorganized grassroots businesses, claimed by the company in a statement.
"For over five years now, Aye Finance has been a trusted partner in our endeavour to bridge the credit gap in the micro enterprise sector via private capital funding. We are once again delighted to collaborate with Aye to support the growth of small, resilient businesses post a difficult couple of years," said Rudrashis Roy, investment officer at responsAbility Investments AG.
Founded in 2003 and headquartered in Zurich, responsibility Investments AG has invested over $12 billion since inception and has a strong performance track record, the statement added.