Aye Finance, a new age Non-Banking Financial Companies (NBFC) focused on lending to micro enterprises, is aiming to grow its loan book to ₹5,000 crore in next five years, a top official said.

This Capital G (Google parent Alphabet’s investment arm)-backed financial technology (fintech) company, which started its journey in 2014, will close current fiscal with a loan book of about ₹1,000 crore, Sanjay Sharma, Managing Director and Chief Executive Officer (CEO), Aye Finance told BusinessLine here.

Nearly 85 per cent of the loan book in value terms is collateral free, according to Sharma. For tiny units, which have monthly revenues of ₹2-7 lakhs, the biggest pain points are going digital and providing collateral for funding.

Sharma also said that Aye Finance, which currently works as an assisted digital fintech platform, had achieved break-even in 2017-18 and is on course to achieve profits this fiscal too.

Stating that Aye Finance has already served 1,20,000 Micro, Small and Medium Enterprises (MSMEs) (mainly micro units with ₹2-7 lakh monthly turnover), Sharma said that the aspiration is to cater to atleast 5 lakh micro enterprises in next five years.

“We will continue to be focused on micro enterprises in the coming days and there is still large funding gap in this segment”, he said.

Sharma said that Aye Finance—which had last raised ₹147 crore in a Series C funding led by CapitalG (investment arm of Google’s parent company Alphabet)—will go in for futher capital raise via Series D in 2019-20 to fund its business growth.

The other marquee investors in Aye Finance are SAIF Partners, Accion, LGT. Together with CapitalG, these four investors control over 70 percent stake in Aye Finance.

Sharma said that Aye Finance, through its unique cluster based study , identifies MSMEs in different markets and post analysis of their business, disburses the required amount.

“The delinquency in our book is less than 2 per cent”, he said. The lending is largely done on the estimation of cash flows of the micro enterprises.

He also felt that Government through Mudra can do some “heavy lifting” to enhance the flow of credit to micro enterpises.

Aye Finance, which has about 104 physical outlets across the country, will look to treble it in next five years as part of its expansion plans.

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