indiagold, a gold-focused alternative credit platform, is planning to raise $12 million funding from PayU and Alpha Wave Incubation (AWI) fund. Other investors such as Better Tomorrow Ventures, 3one4 Capital, RainmatterCapital, and Leo Capital will also be participating in this round.

Launched in 2020 by Deepak Abbot and Nitin Misra, indiagold offers gold-backed loans, gold savings, and gold locker services to over a million consumers in India. Both the founders have worked as Senior Vice President of Paytm in the past.

The company aims to build a doorstep gold loan business backed by a robust technology stack, AI-based gold assessment capabilities, and superior customer-centricity – offering faster gold release and a transparent repayment policy. indiagold has made its Gold Locker service more secure, transparent, and convenient.

Nitin Misra and Deepak Abbot, co-founders of indiagold said, “India offers a large $650 billion addressable gold loan market which is highly fragmented and currently dominated by the informal segment. Even the formal segment hasn’t adopted digital practices at scale. indiagold’s suite of financial products bridges this critical need gap by digitally transforming lending against gold. With the support of our existing and new investors, we are moving aggressively towards our larger vision of establishing gold holdings as an alternate credit score, and creating a gold back credit platform for lenders to provide instant credit against gold.”

Vijay Agicha, Global Head of Strategy & Growth, PayU said, “Empowering disruptive fintech entrepreneurs through early-stage investments is a key element of PayU’s growth strategy. By supporting businesses that complement our existing portfolio, we aim to achieve our vision of developing a fintech ecosystem that will meet the financial services needs of millions of Indians. We believe that indiagold has the unique opportunity to expand the addressable market on the back of its product offerings and scale the business up significantly.”

Navroz D. Udwadia, Co-founder of Falcon Edge Capital said, “Gold, found in almost every household in India, is the key to provide affordable credit to every Indian. indiagold’s doorstep gold loan and gold locker products offers good customer experience and enables it to offer credit at more affordable rates.”

The gold financing business in India is predominantly offline, dominated by the informal segment, which accounts for approximately 70 per cent of gold loans in India. These loans address the liquidity needs of Indians without access to unsecured credit which is availed by less than 10 per cent of the total working population. The Covid-19 pandemic has accelerated the demand for short-term, low-cost, safe, and easily accessible formal credit options like digital gold loans.

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