Fintech startup ZestMoney has tied up with Northern Arc Capital that aims to address the growing demand for EMI financing in India.

Northern Arc Capital has deployed $14 million till date and plans to fund various products offered by ZestMoney in a phased manner, the startup said. This will help ZestMoney, which plans to disburse $400 million by the end of 2020

ZestMoney is a technology platform that provides access to consumer loans to Indian households, with no access to credit cards or any other formal financing options due to insufficient credit history. This the startup does by using technology, such as data science and digital banking.

Northern Arc Capital enables financial inclusion in India by providing institutions that target lending to middle-income households and small businesses with critical access to debt capital markets. Northern Arc’s partnership with ZestMoney will also span an array of both domestic and international structured funding markets in addition to providing direct funding on the origination platform, the company said.

Lizzie Chapman, CEO, ZestMoney said “We are striving to develop a deeper and holistic ecosystem for expanding our palette of offerings and access to affordable EMI solutions."

Kshama Fernandes, MD & CEO of Northern Arc Capital said, “Building on our decade-long experience of underwriting granular retail portfolios, Northern Arc has adopted a digital approach toward direct lending.

ZestMoney also recently announced a strategic partnership worth $100 million with Credit Saison, a Japanese financial services company affiliated with Mizuho Financial Group and the third-largest credit card issuer with over 20 million cardholders in Japan. This funding will be directly deployed into ZestMoney’s core loan origination activity.