NeoGrowth Strengthens MSME Lending with New Rs 85 Crore Funding
NeoGrowth, a digital lender focused on MSMEs, has successfully raised Rs 85 crore through a combination of equity and debt from the Dutch development finance institution FMO and existing investor LeapFrog Investments. The Mumbai-based firm had previously obtained Rs 300 crore (approximately $36 million) in a Series D equity round in December 2022, which was led by FMO along with other current investors.
The recent funds will be utilised to expand its loan portfolio to nearly Rs 3,000 crore before the firm anticipates needing another infusion of equity, as stated in a press release by NeoGrowth.
About NeoGrowth and Its Offerings
Founded in 2011 by Dhruv Khaitan and Piyush Khaitan, NeoGrowth is dedicated to providing business loans that cater specifically to small enterprises. The company’s product range includes both collateral-free and collateral-based loans designed for micro, small, and medium enterprises (MSMEs).
Utilising advanced technology and data analytics, NeoGrowth assesses borrowers primarily based on digital payment data, point-of-sale (POS) transactions, and cash flow, rather than depending exclusively on traditional collateral. The lender also offers adaptable repayment options, allowing for daily, weekly, fortnightly, and monthly collections.
Market Reach and Potential
NeoGrowth claims to operate in over 25 cities across India, providing services to more than 80 business segments and serving upwards of 1 lakh businesses. Digital lenders in the industry are increasingly leveraging GST records, banking transactions, and digital payment histories to assess the creditworthiness of borrowers, enabling them to extend loans to kirana stores, manufacturers, distributors, and small service providers.
The growth within this segment has captured the attention of investors as lenders focus on reaching underserved MSMEs through methods like supply chain financing and embedded credit solutions.
Recent Trends in MSME Funding
Recent funding activities highlight this burgeoning trend. In February 2026, Prayaan Capital secured Rs 110 crore in a Series A round led by Peak XV Partners, which aims to enhance its technology-driven MSME lending platform. In addition, GetVantage raised Rs 63 crore in Series A1 funding in August 2026 to scale its cash flow-based financing solutions for businesses.
Moreover, Business Nextgen Finance raised Rs 215 crore in equity to enhance its technology-enabled secured lending operations for underserved MSMEs. Other significant fundraises include FlexiLoans, which received Rs 375 crore in a Series C round in June 2025, and Techfino, which secured Rs 65 crore in June 2025 to expand its technology-enhanced lending services in smaller cities.