Non-banking lender NeoGrowth, which focuses on micro, small and medium enterprises (SMEs), has secured $20 million in funding from the United States’ International Development Finance Corporation (DFC) through the External Commercial Loan (ECB) route.
According to Arun Nayyar, director and CEO, “NeoGrowth funds Indian small businesses by leveraging the digital ecosystem and this support from DFC will help us drive that mission further, while creating a positive impact on SMEs. We will use these funds to continue providing credit to our customers to drive their business growth.
The financing is for five years with a two-year moratorium on principal payments and will be used for subsequent loans to SME customers in accordance with ECB guidelines, the company said.
The US International Development Finance Corporation (DFC) is an American development finance institution. “DFC’s investment in NeoGrowth will improve access to capital for small businesses in India. NeoGrowth’s digital and flexible model allows it to reach more small businesses, promoting financial inclusion, economic growth and development across the country,” said James Polan, vice president of DFC’s Development Credit Office.
The NBFC is backed by investors such as Omidyar Network, Lightrock, Khosla Impact, Accion Frontier Inclusion Fund – Quona Capital, IIFL Seed Ventures Fund, WestBridge and Leapfrog Investments. The company says it has engaged with more than one lakh customers and disbursed over $1 billion in loans. at 25 locations in India.