InCred Finance Attains Unicorn Status with $1.04 Billion Valuation Following $60 Million Funding Round

• ByStartupStory     |    December 25, 2023

InCred Finance, the lending arm of financial services firm InCred, has achieved unicorn status, securing a valuation of $1.04 billion after a successful $60 million Series D funding round. The non-banking financial company (NBFC) announced this milestone, making it the second company to attain unicorn status in 2023, following the 10-minute grocery delivery startup Zepto.

The equity round, spearheaded by Ranjan Pai of MEMG, saw significant investments, with $9 million from Pai himself. Ravi Pillai, Chairman at RP Group of Companies, and Ram Nayak, Global Co-Head of the Investment Bank and Head of Fixed Income & Currencies at Deutsche Bank, also contributed $5.4 million and $1.2 million, respectively.

In addition to these key investors, the funding round witnessed participation from various large ultra-high-net-worth individuals, family offices, and institutional investors, including Varanium Capital Advisors and Sattva Group.

Bhupinder Singh, Founder & Group CEO of InCred, expressed his confidence in the funding’s impact, stating, “The funding will strengthen our balance sheet and provide us enough runway for the next couple of years of expansion. With our ‘Risk First’ approach, cutting-edge technology, and class-leading management team, we are well-positioned for sustained growth in the business over the years to come.”

InCred Finance plans to strategically deploy the raised capital across its core business verticals, focusing on consumer loans, student loans, and MSME lending. The company highlighted the surging market for student loans in India, driven by a doubling of US student visas issued to Indians from 50,000 to 100,000 over the past two years. Simultaneously, the MSME business is experiencing substantial growth, especially in the secured LAP market nationwide, while the consumer lending business benefits from healthy demand driven by overall economic growth and the usual festive season boost.

InCred Finance boasts a loan book exceeding Rs 7,500 crore, growing at a remarkable 50% CAGR over the last three years. Its profit before tax (PBT) stood at Rs 42 crore in FY22 and soared to Rs 203 crore in FY23.

According to data platform Statista, digital lending is one of the fastest-growing fintech segments in India, estimated to be worth $350 billion by 2023, after experiencing exponential growth from $9 billion in 2012 to nearly $150 billion in 2020. Another report by IIFL Infotech projected India’s digital lending market to reach $515 billion by 2030.

Despite the optimistic outlook for digital lending, the Reserve Bank of India recently raised risk weights on personal loans, loans to NBFCs, and credit cards, warning against a potential crisis in the unsecured loan segment. This move is anticipated to result in higher lending rates and slower growth in these segments.

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