Of the total capital, Norwest Venture (NVP) has contributed $45 million, with the remainder coming from other new and existing investors.
As of 2020, the company had raised $35 million from investors led by Sequoia Capital.
The Jaipur-based company caters to customer segments such as micro-entrepreneurs and semi-skilled professionals who do not have or have limited access to loans from formal financial institutions. The loans are tailored to the needs of its target segment of small service providers, manufacturers and retailers.
Founded in 2016 by Mohit Sahney and Sunita Sahney, Finova Capital has 180 branches spread across 8 states in western, northern and central India. It has over 20,000 customers and a loan book of over Rs 1,000 crore. “Finova continues to expand into its neighboring regions, using and building on its internal knowledge and processes in the field,” a company statement read.
Finova is backed by 34 banks, NBFC and AIF.
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“We continue to invest heavily in our technology capabilities and operations to further enhance our goal of helping realize the dreams of millions of small entrepreneurs over the next decade. Our processes combined with disciplined underwriting have ensured our resilience to the pandemic while keeping portfolio growth and quality intact,” said Mohit Sahney, Founder and CEO of Finova.
“Finova has demonstrated best-in-class asset quality, having built a strong underwriting framework with the use of technology and data analytics and has built a low-cost diversified liability franchisee in the north, the west and central India,” said Niren Shah, Managing Director and Head of NVP India.
According to a November 2021 report by Crisil, after overcoming multiple challenges over the past three fiscal years, assets under management (AUM) of non-bank financial companies (NBFCs) are expected to increase by 8-10% in the next fiscal year, over two tailwinds — improving economic activity and strengthening balance sheet cushions.
“We believe in Finova’s ability to grow profitably while creating significant impact,” said David Paradiso, Partner at Maj Invest.
“As early investors in Finova Capital, we have had the opportunity to witness the strong growth of the company over the past three years…” said Aditya Parekh, co-founder and managing director of Faering Capital.