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Aye Finance Secures INR 137 Cr Debt Funding to Bolster MSME Lending in India

Fintech startup Aye Finance has secured debt funding of INR 137 crore from German impact investor Invest in Visions. This fresh capital injection comes on the heels of their INR 310 crore Series F funding round in December, led by UK's British International Investment (BII).

The new funds will allow Aye Finance to expand its reach and offer vital financial assistance to underserved micro, small and medium enterprises (MSMEs) across India. The company plans to use the capital for on-lending, enabling these businesses to grow and contribute to the country's economic development.

"This new funding will allow us to reach out to a larger population of micro enterprises and offer them innovative financial products," said Krishan Gopal, CFO of Aye Finance. "We are confident that this will enable us to empower even more entrepreneurs and unlock their full potential, ultimately contributing to job creation and economic prosperity across the country."

The collaboration between Aye Finance, Invest in Visions, and Agents For Impact (AFI) signifies a commitment to financial inclusion in India by supporting MSMEs, a traditionally underserved segment by banks.

Founded in 2014, Aye Finance has carved a niche in providing affordable business loans to microenterprises in India. They leverage a unique cluster-based credit assessment system along with AI algorithms to evaluate risk profiles even in the absence of traditional financial documentation.

The company's dedication to MSMEs is evident in their achievements. Last month, Aye Finance surpassed the milestone of disbursing over INR 10,000 crore in loans to small businesses across India. They boast an active client base exceeding 4.5 lakh microenterprises and an Asset Under Management (AUM) of over INR 4,000 crore.

Aye Finance's success story is further reinforced by their Q1 FY24 results, reporting a profit after tax of INR 38.67 crore, a significant 4x increase compared to INR 9.78 crore in Q1 FY23.

Operating in the competitive lending-tech space, Aye Finance empowers microenterprises in sectors like manufacturing, services, trading, job work, and dairy. They compete with players like ftcash, ARTH, FlexiLoans, Lendingkart, LenDenClub, and Kinara Capital.


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