Bangalore-based Vistaar Financial Services becomes the first small enterprise financing firm to get infusion from Lok Capital and Omidyar Network.
Vistaar on Wednesday said it had raised Rs 40 crore in its second round of funding from these two funds along with its two existing investors.
The globally active fund Omidyar was started by eBay founder Pierrre Omidyar and his wife Pam. Mumbai-based Lok supports social enterprises.
Vistaar also got finance from its existing investors, Elevar Equity and SVB India Capital Partners. It said the oversubscribed second round would be used to expand its network of 180 branches over the next four years. It would then have a projected portfolio of Rs 1,600 crore.
Vistaar was promoted in 2010 by Brahmanand Hegde, Managing Director and CEO; and Ramakrishna Nishtala, Founder Director and COO.
They said, “With this new round of fund raising, we can scale the business more rapidly.”
It lends from Rs 30,000 to Rs 20 lakh in an underserved domestic market of 2.6 crore micro and small enterprises. They include powerloom operators, light engineering units, small grocery stores and small restaurants, which run small, scalable and profitable businesses and need capital to grow.
Less than five per cent of MSMEs have access to credit from the formal financial services sector, according to Vistaar.
“We recognise the importance of innovative credit and individual lending to the informal segment,” a release said quoting Vishal Mehta, co-founder and Partner, Lok Advisory Services, and Badri Pillapakkam, Principal, Omidyar Network India Advisors.