ET BureauBengaluru: Peer to peer lending startup Faircent has raised Series A round led by JM Fiancial Ltd subsidiary which has picked up 9.8% stake in the company. Existing investors Aarin Capital Partners and other individual investors have also co-invested in the round. Though undisclosed, the amount is estimated to be close to Rs 16.5 crore (between USD 2.5 million to 3 million).
The capital will be utilized by the company to build technology and product apart from hiring a team to strengthen the play. “The regulatory arbitrage in the peer-to-peer lending sector has cleared up with the RBI’s initiative for a white paper in the space. However some points need clarity, especially the presence of physical entities, though we are a technology play,” said Vinay Mathews, chief operating officer of Gurgaon based Faircent. He added that Faircent is in talks to raise a larger round in six months’ time for marketing the business.
The company which has disbursed close to Rs 4 crores in the last six months has a registered lender base of 5000. Ambiguity in regulation of peer-to-peer lending space has held back strategic investors from betting on this category of financial services. JM Capital’s investment comes at a time when RBI is taking a closer look at aggregation service for lenders and borrowers where the interest rates can range from 12 to 36%, based on negotiations between the two parties.
Founded in 2013 by Rajat Gandhi and Mathews, the company had raised an undisclosed amount in October 2015 led by Mohandas Pai’s Aarin Capital and a seed round of USD 250,000 from M&S Partners in June 2015.
The capital will be utilized by the company to build technology and product apart from hiring a team to strengthen the play. “The regulatory arbitrage in the peer-to-peer lending sector has cleared up with the RBI’s initiative for a white paper in the space. However some points need clarity, especially the presence of physical entities, though we are a technology play,” said Vinay Mathews, chief operating officer of Gurgaon based Faircent. He added that Faircent is in talks to raise a larger round in six months’ time for marketing the business.
The company which has disbursed close to Rs 4 crores in the last six months has a registered lender base of 5000. Ambiguity in regulation of peer-to-peer lending space has held back strategic investors from betting on this category of financial services. JM Capital’s investment comes at a time when RBI is taking a closer look at aggregation service for lenders and borrowers where the interest rates can range from 12 to 36%, based on negotiations between the two parties.
Founded in 2013 by Rajat Gandhi and Mathews, the company had raised an undisclosed amount in October 2015 led by Mohandas Pai’s Aarin Capital and a seed round of USD 250,000 from M&S Partners in June 2015.
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