Lending tech non-banking financial company (NBFC) Arthan Finance, specialising in loans for self-employed nano and micro entrepreneurs, has raised ₹50-crore from marquee investors such as Incofin India Progress Fund and the Michael & Susan Dell Foundation, a returning investor.

The Mumbai-based fintech start-up will deploy fresh fund infusion for geographical expansion and technological progress, as well as grow its assets under management (AUM), expand its geographic footprint and invest in advanced AI and ML-based underwriting systems. The technological enhancements will improve the company’s ability to assess credit risk and tailor financial solutions for the unorganised sector, further streamlining operations and enhancing customer experience.

Founded by Kunal Mehta, Pravash Dash and Gowrisankar Rao Alamanda in 2018, Arthan Finance provides loans to self-employed nano and micro entrepreneurs in tier-II, III and IV cities across Maharashtra, Odisha, Andhra Pradesh and Telangana.

The lending tech start-up claims to have provided ₹500 crore worth of loans to more than 20,000 borrowers, with the loan size varying from ₹2,000 to ₹20 lakh.

However, Mehta did not comment on the valuation of Arthan Finance after this deal. Although he said, currently the company has AUM of ₹130 crore.

To date, Arthan Finance has raised approximately ₹83 crore. Previous funding rounds saw participation from the founders, angel investors and the Michael & Susan Dell Foundation.

Technological advancement

“This funding is crucial for our next phase of growth. We are committed to enhancing our technological capabilities and expanding our reach to serve more micro and small enterprises in underserved regions. Our partnership with esteemed investors such as Incofin and the Michael & Susan Dell Foundation reinforces our mission to drive financial inclusion in India,” said Kunal Mehta, Founder and Director of Arthan Finance.

Arthan Finance currently operates in Maharashtra, Odisha, Andhra Pradesh and Telangana, providing growth capital to self-employed nano and micro enterprises in tier-II, III and IV cities.

Aditya Bhandari, Partner and Regional Director, Asia Equity at Incofin, said, “Arthan has tremendous potential to demonstrate how social impact can be driven through an enviable blend of technology and inclusive financial services. We believe Arthan is well-positioned to be at the forefront of India’s digital-led MSME financing revolution.”