New Delhi, June 5 -- Digital lending startup LoanTap, backed by venture capital firms like 3one4 Capital, India Quotient, and Avaana Capital, has raised Rs 54 crore ($6.2 million) in equity in its pre-Series C funding round.

The round was led by Bengaluru-based early-stage fund July Ventures, with participation from existing investors including 3one4 Capital, Avaana Capital, Kae Capital, and the Swapurna Family Office. In addition to the equity infusion, LoanTap also secured Rs 20 crore in venture debt.

In a statement, the Pune-based company said it will use the capital to expand its supply chain financing offerings for small retailers.

"India's MSME sector is undergoing a massive transformation, and we plan to use this momentum to double down on invoice financing, an area we see as a powerful enabler for MSME growth across India. (Our credit assessment tool) Business Indicator for Credit Ratings in India also enables distributors to evaluate and extend business and trade credit to retailers," said Satyam Kumar, CEO and co-founder, LoanTap.

"Together, with these engines, capital access and credit preparedness, we plan to drive the next phase of MSME empowerment," he added.

LoanTap was founded by Satyam Kumar and Vikas Kumar in 2016. It offers personal loans to salaried professionals earning Rs 30,000 and above through its subsidiary, Loantap Credit Products Pvt Ltd. It also provides credit to micro, small, and medium enterprises (MSMEs) via its unit I-Loan Credit Pvt Ltd.

Tragically, co-founder Vikas Kumar passed away in an accident in April.

The latest fundraise comes about six years after LoanTap announced its last equity raise of $12 million (Rs 102 crore) as a part of its Series B round, which was led by Avaana Capital in October 2019. Earlier, in January 2019, it raised $8 million, led by 3one4 Capital. So far, LoanTap has raised close to $25 million in equity funding.

In addition to equity, the company also secured debt of around Rs 24 crore from investment firm Lighthouse Canton to support its growth plans.

As of March 31, 2024, LoanTap reported assets under management of Rs 388 crore on a consolidated basis, up from Rs 357 crore a year ago, according to rating agency CRISIL. The group's losses narrowed to Rs 12.4 crore on a total income of Rs 67.5 crore in FY24, compared to a loss of Rs 21 crore on a total income of Rs 69 crore in FY23.

Published by HT Digital Content Services with permission from VC Circle.