On Thursday, 1st November, Veritas Finance Pvt Ltd, a Non-banking finance company made an announcement stating that it has raised Rs 200 crore in a series D investment round led by private equity firm Norwest Venture Partners.
Veritas Finance is a company founded in 2015 which now has more than 21,000 customers and 132 branches all over India, the company majorly focusses on micro, small and medium enterprises (MSME’s).
As per reports, the latest funding round saw existing investors, Development Finance Institution of UK, anchor investor P. Surendar Pai and CDC Group Plc also taking part in it.
In a demonstration, Veritas revealed its aim of how it would be utilizing the additional capital to grow in existing markets, additionally, the non-banking finance company also said that it would help augment the capital required by MSMEs for asset creation and business expansion.
Speaking on the announcement, Chief executive and Managing Director of Veritas Finance, D. Arulmany said, “The Indian economy is MSMEs. Considering they are an underserved segment, it is obvious that they would require frequent access to the formal credit system. As we constantly look to innovate our products and services by building a robust credit appraisal system. Other than expansion, we would also strengthen our technology, through this funding which will help us in reducing the cost of servicing micro-businesses and achieve higher productivity.”
Since starting its operations back in 2015, the lender has built a loan book of Rs 500 crore.
In a statement, the director at Norwest Venture Partners, Sumer Juneja said, “To drive growth and provide financial services to micro, small as well as medium enterprises in India, Veritas Finance has positioned itself quite uniquely. We look forward to working with the Veritas Finance team to further enhance their footprint, technology, and services by adding more value to customers.”
As per reports, Veritas Finance had a financial advisor in the form of Investment bank, Avendus Capital.
The timing of this transaction is rather unfortunate, as lately the non-banking lending sector has been hit by a liquidity crisis, influenced by the defaults declared by Infrastructure Leasing and Financial Services (IL&FS).
In a statement published on Wednesday, October 31st, American PE investor TPG Growth revealed that it spearheaded a $42 million investment in commercial vehicles financier Ess Kay FinCorp.