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Sachin Bansal, Poonawalla Family Infusing INR 100 Crore in New Delhi-based Firm, U Gro Capital

According to the media report, the investment will be made through two separate securitization and bond deals.
BY Jaspreet Kaur
Feature Writer, BusinessEx
Oct 07,2019

Sachin Bansal, Co-founder of Flipkart, is proactively infusing in the technology-enabled firms after his departure from the e-commerce firm. Recently, the tech entrepreneur and family office, Poonawalla Family have together infused nearly INR 100 crore in the digital lending stage, U Gro Capital, as stated by the media agency, The Economic Times.

According to the media report, the investment will be made through two separate securitization and bond deals.

With these two hefty deals, it is evident that financial-technology companies are attracting investors in spite of the monetary crisis in the Non-banking Financial Sector (NBFC) sector, in which outflow of funds from mutual funds have ceased for a long period.

Upholding the Financial Sector

Former CEO of Religare Finance, Shahchindra Nath-led fin-tech company, U Gro will employ the funds to enhance its business at a time when there is a dearth of capital in the sector.

"These transactions demonstrate our ability to securitize our book at an early stage of our development and establish that besides conventional term-financing, we have the ability to raise resources from alternative channels as well," Executive Chairman of U Gro, Shahchindra Nath said in an interview to The Economic Times.

In the previous year, the New Delhi-based fintech company had amassed $140 million capital from ADV Partners, Samina Capital, Well Fargo, CitiGroup, New Quest, and PAG Asia. It had further amassed capital from public market investors like PNB Metlife, Abakkus and various other family offices, as stated by the newspaper, BusinessLine.

According to the cited report, in January this year, the fintech company began its disbursals. It paid out over INR 600 crore in debt to the companies throughout India.

The company essentially administers a digital SME lending platform that assesses the creditworthiness of a borrower via an automated credit appraisal process. It approves the loan to the borrowers in less than an hour. It has formed statistical scorecards that forecast customer behavior, validate data and help the system to ascertain fraud.

The fintech company has done its foremost securitization transaction with Poonawalla Finance Pvt. Ltd, a subsidiary of the family office. The family office is independently carrying out transactions in NBFC space and is planning to buy out shares in the sector, anonymous sources told the media agency, The Economic Times.

On the other hand, Co-founder of Flipkart, Sachin Bansal had made a non-convertible debenture deal with the fintech company. After exiting Flipkart, Bansal has been infusing in the Indian startups and mentoring the budding entrepreneurs.

In February this year, Bansal was reportedly in discussions with financial experts to initiate a new firm in the fintech space. Furthermore, he had reportedly met the central bank (Reserve Bank of India) executives to ascertain eligibility requirements for initiating a bank.

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