Navadhan, a rural fintech start-up, has raised $1.5 million in a seed round led by fintech focused fund, Varanium NexGen.

The round also saw participation from existing investors such as Anicut Capital, and Gemba Capital. The platform bridges rural small businesses (MSMEs) and NBFCs and Banks, facilitating seamless connections, and plans to utilise the raised funds to expand and enhance its AceN Tech platform.

With a network of 15 lenders, including Ugro, Vivriti, Northern Arc, Caspian, Unitus, and TruCap, the startup claims to have enrolled over 2 lakh customers and disbursed over Rs. 100 crore, empowering rural enterprises and stimulating economic growth.

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In a previous pre-Seed funding round, it secured funds from Anicut, BOPA, Flowstate, and notable angels such as Prasanna Rao ( and Sarah Djari (Impact Fintech PE), Navadhan has now raised a cumulative funding of $16 million in equity and debt lines, partnering with NBFCs.

“We are leveraging technology using alternative credit and predictive analytics backed by data sciences and are trying to make it work for the NBFCs and Banks to generate priority sector assets. The new fundraiser will add tailwinds to our growth plans. As smartphone and UPI penetration improve, we have an early mover advantage in the rural markets,” said Nitin Agrawal, Founder and CEO of Navadhan.

Focus on informal market

The platform offers a digital onboarding experience, simplifying the customer journey and eliminating paperwork. With the power of data science, its proprietary alternative underwriting model assesses the digital footprint and cash flow surrogates, which helps address the challenges of the predominantly cash-based economy and limited banking track record in rural markets, the company said in a release.

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”While most of the fintech space is focused on Tier-1,2,3, we saw the startup’s focus on the informal market as a potential high-growth area. Navadhan’s founders are seasoned professionals with credible experience in financial services. With the right TAM, team, technology, and traction, they are building an early mover’s advantage in rural markets. Moreover, the tech-led approach gives non-linear scalability to their model,” said Aparajit Bhandarkar of Varanium NexGen.

According to the company, smartphone, and internet penetration are projected to increase by 44 per cent by 2030, with significant growth expected in rural areas. As the number of UPI transactions inches towards the $4 trillion mark, most of the future growth will come from rural markets. The company plans to introduce new solutions and offerings which includes credit limits and tech tools for digitising un-organized value chains.