Rural-focused lending platform SarvaGram Solutions Pvt. has closed a Series C round, raising $35 million—around Rs 290 crore—from a clutch of investors, including Singapore's Temasek.
The round was led by Elevar Equity, a fund that focuses on essential services in India and Latin America. Other investors were Elevation Capital, Temasek, and TVS Capital Funds.
SarvaGram previously raised a Series B round of $10 million in February 2021, led by Elevation Capital and Elevar Equity. In a statement, the fintech said it will use the funds to expand its distribution network by adding 75 outlets to reach 125 by the end of FY24.
It also plans to expand its on-ground franchisees—SarvaMitra—to triple their current strength across different states in India. The 'SarvaMitra' stores act as farm mechanisation stores and also offer loans to rural dwellers and farmers.
"The funds would also be deployed towards strengthening the technology layer—both in terms of hiring tech talent and solidifying SarvaGram’s existing tech stack—to support and enhance business operations," it said.
Mumbai-based SarvaGram, founded in 2019, currently offers loans of up to Rs 25 lakh at attractive interest rates through its app and website to rural India, a target market it pegs at over 80 million households.
The company, founded by Utpal Isser and Sameer Mishra, says that through its distribution platform, it "applies data-driven intelligence" to assess a household's overall potential, including an in-depth understanding of their ground reality, balance sheets, and multiple income streams. "This allows a high degree of de-risking as well as customization, thus serving the needs of the households as opposed to being restricted to a product selling paradigm," it said.
"The fundraise will boost our mission of putting more power in the hands of rural households by enhancing our technology platform, strengthening the data analytics layer apart from growing our distribution, and adding on-ground human capacity," Utpal Isser, co-founder and chief executive officer at SarvaGram, said.
Mridul Arora, partner at Elevation Capital, said SarvaGram's lending offering creates the foundation to offer a range of solutions for a "tricky" rural borrower, given multiple income streams, variability in agricultural earnings, and limited paper trails. "While collateral may be available, the documentation is non-standardised. Consequently, the rural market is underserved by banks and large NBFCs—a clear white space addressed by SarvaGram."
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