Loantap Secures $6.2 Million in New Equity Funding

Pune-based digital lender Loantap has successfully raised $6.2 million in a recent equity funding round, spearheaded by July Ventures. Existing investors such as 3one4 Capital, Avaana Capital, Kae Capital, and the Swapurna Family Office also played a significant role in this funding.

In addition, the company secured $2.3 million in venture debt during this round, which brings the total funding raised to around $26 million.

Recent Acquisitions and Financial Growth

In March 2023, Loantap acquired Unofin, a fintech startup focused on healthcare, to enhance its footprint in healthcare finance. This year, Loantap also raised a debt round of approximately Rs 24 crore ($2.9 million) from the global investment firm Lighthouse Canton.

Transitioning Business Models

Founded in 2016 by Satyam Kumar and Vikas Kumar, Loantap has shifted its business model from consumer lending to catering to small merchants, including pharmacies and stationery shops. The company has notably diminished its unsecured consumer loan portfolio and now concentrates on sourcing these loans for NBFC partners, rather than lending from its own balance sheet.

Current Performance Metrics

Currently, Loantap claims an annual disbursal run rate of Rs 600 crore across 26 cities, serving nearly 50,000 retail customers. The company aims to increase annual disbursements to Rs 900 crore by FY26. The target audience includes merchants with turnovers under Rs 20 lakh, with credit lines primarily allocated for inventory purchases from distributors.

Technological Advances

Loantap has developed a middleware tech platform designed to assist banks and NBFCs in originating and managing loans for small businesses. This software is currently being utilised by three financial institutions.

Financial Overview and Leadership Changes

The company finished FY24 reporting Rs 67.5 crore in revenue, alongside a net loss of Rs 12.7 crore. Following the unfortunate passing of co-founder and CTO Vikas Kumar in April 2024, Loantap is planning to promote a senior executive to the position of co-founder and appoint a new CTO from its existing team.