FlexiLoans, a fintech company providing financial solutions for micro, small, and medium enterprises, secured Rs 75 crore, about $9 million, through the issuance of non-convertible debt by JM Financial. The deal marks the second debt round for the Mumbai-based startup in the ongoing calendar year, proof of the strategic steps it is executing towards increasing its capacity in lending and bearding its growth tempo.
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Internal documents accessed by Entrackr show that the board of FlexiLoans has agreed to the issuance of 7,500 non-convertible debentures to mobilize the funds. The debt bears a coupon rate of 12.05% per annum and is structured with a tenure of 24 months. The funds are proposed to be utilised for backing the current business operations to continue extending collateral-free loans to MSMEs across India.
This debt infusion comes at the most opportune time for FlexiLoans, as the company is on the verge of closing an additional $35 million in funding from late-stage fund Fundamentum co-founded by Infosys veteran Nandan Nilekani. The incoming investment will mean investors are still in love with FlexiLoans’ business model and its potential for long-term growth in the burgeoning fintech industry.
Founded by Deepak Jain, Manish Lunia, Ritesh Jain, and Abhishek Kothari, FlexiLoans rose to become one of the top MSME-focused lending platforms. It has so far mopped up over $124 million in equity and debt funding. This includes a large $90 million Series B round that closed in June 2022 led by marquee investors such as Fasanara Capital, MAJ Invest, and Caravel Group.
FlexiLoans has posted robust growth in the recent past, and its operating revenues surged to Rs 262 crore in FY24 from Rs 109 crores in FY23. This growth trajectory is further underlined by the fact that it has continued to stay profitable with a profit after tax of Rs 3 crore for the period. The fintech firm has seen fast growth due to its various innovative lending solutions and strong strategic tie-ups with more than 400 partners.
Apart from its partnerships, FlexiLoans lends through its own NBFC arm, Epimoney. Its loan ticket sizes are from Rs 50,000 to Rs 1 crore for periods of up to 36 months, meeting most MSME requirements.
It operates in a competitive landscape and competes with several fintech companies like Lendingkart, Indifi, Incred, Oxyzo, and Aye Finance. Notwithstanding the competition, FlexiLoans is managing to carve out a niche for itself by using technology and data-driven insights to bring client-centric financial solutions to customers.
In a nutshell, the latest JM Financial debt financing is a resounding endorsement of the sound business model at FlexiLoans and its commitment to empowering MSMEs through easier access to financial services. With further geographic expansion lined up on its agenda and constant product improvement, it still has the potential for further growth and success in the dynamic fintech industry.
