Mumbai-based fintech startup SarvaGram Solutions has raised $35 million in a Series C funding round to provide credible loans for emerging middle-class in rural India.
Founded in 2019, SarvaGram came up with a lending system that sets it apart from the traditional one. It performs a 360-degree assessment of the entire household to create a customized loan for that specific case. The startup’s target market is “underbanked” people.
To approach communities in rural areas, SarvaGram works with local partners, which the startup calls “SarvaMitra.” The partners will engage with the local communities and offer SarvaGram’s products with a door-to-door system.
SarvaGram has developed supporting tools — including scorecards for customer segmentation — that can automate lending decisions. The startup also created underwriting algorithms to increase the security of its loans.
The startup provides durable loans for various purposes — asset creation, consumption, security, business growth and farm productivity. The startup currently has over 250 franchise partners that cover 8,000 villages across four states. In those states, SarvaGram operates eight hubs that oversee a total of 50 outlets.
Elevar Equity, which participated in one of SarvaGram’s earliest funding rounds back in 2019, led the startup’s capital-raising activity. Large investment firms like Temasek and Elevation Capital also participated in the Series C funding. Before the latest funding round, SarvaGram raised $10.5 million in a Series B funding round.
According to Elevation Capital, SarvaGram is close to reaching profitability in this phase. The startup currently has $33.2 million in assets.
Co-founder and CEO Utpal Isser said the company would use the fund to further expand its business.
“The fundraise will boost our mission of putting more power in the hands of rural households by enhancing our technology platform, strengthening the data analytics layer, apart from growing our distribution and adding on-ground human capacity,” Isser said.
SarvaGram expects to build an additional 75 outlets by the end of 2024 to boost its outlet number to 125. It will also expand to other rural states in India and recruit more SarvaMitras from those areas. SarvaGram also wants to improve the efficiency of its operation with tech development.
