Digital lending startup EarlySalary secures $110 mn in funding led by TPG’s The Rise Fund
- ByStartupStory | August 30, 2022
EarlySalary, a digital lending platform, has secured $110 million in a new round headed by TPG’s The Rise Fund and Norwest Venture Partners. Piramal Capital and Housing Finance Limited, both existing investors, also participated in the Series D round. EarlySalary reports that the financing includes a secondary component and values the Pune-based business at $300 million. The extra money will be utilized to expand into new markets, accelerate its loan book, and invest in talent development.
The current round arrives approximately two years after the previous one. It received $10 million in Series C funding from Eight Road Ventures and Chiratae Ventures in October 2020. To date, the business has raised $144 million. EarlySalary, founded in 2015 by Akshay Mehrotra and Ashish Goyal, works with small, medium, and big businesses to provide short-term loans of up to Rs 5 lakh to their employees for shopping, travel, education, and medical crises. Instant loans, personal loans, BNPL, and SalaryCard are among its product offerings.
According to the company, there have been around 12 million app downloads, with 80% of consumers being repeat customers. It already operates in 150 cities and intends to add 100,000 new users each month. It has already made over 2.8 million loans totaling Rs. 7,500 crores (nearly $1 billion). EarlySalary competes directly with Slice, ZestMoney, LoanTap, PaySense, MoneyTap, and IndiaLends, to name a few. It also competes with Refyne, Jify, Kaarva, and Daily Salary in the employee financial benefit area.
After the Reserve Bank of India issued a circular for fintech companies in June, EarlySalary came under scrutiny as well. Prepaid Payment Instruments (PPIs), such as wallets, according to the circular, cannot be loaded using credit lines given by non-banking financial companies. Several startups were impacted by the circular, including Slice, Uni, LazyPay, PostPe, Jupiter, MobiKwik, Ola Postpaid, and EarlySalary.
Following the circular, EarlySalary suspended its card services (SalaryCard) until additional clarification could be obtained. The virtual card is used to provide credit to salaried staff. with higher credit limits, flexible repayment terms, and simple processing. While EarlySalary has yet to file its annual financial report for FY22, the company’s revenue from operations fell by 17% in FY21 to Rs 84.2 crore from Rs 101.6 crore in the previous fiscal year (FY20). During fiscal year 21, it lost Rs 18.8 crore.
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