FinTech Startup LoanTap Closes Its Third Round of Funding, Raises $6.25M Led by Shunwei Capital

LoanTap has cumulatively raised over $20 million in Debt and Equity. It plans to leverage an additional $30 million in debt this year.

Digital lending startup LoanTap has closed its 3rd round of equity funding led by Shunwei Capital. The total round size was $6.25 million with Tuscan Ventures and Ashish Goenka (Suashish Diamonds) participating in the round as co-investors. Existing investors, India Quotient and Kae Capital reiterated their confidence in LoanTap by investing pro-rata in this round as well. After closing its latest round of funding, LoanTap has cumulatively raised over $20 million in Debt and Equity. It plans to leverage an additional $30 million in debt this year.

The company last raised $4 million in Series B funding round in June 2017 from Kae Capital, India Quotient, IFMR, and MAS Financial Services Ltd. In August 2016, it received $3 million (around Rs 20 crore then) from Mumbai-based high net worth individuals Abhishek Pandey and Jaysukh Sapra.

Founded by Satyam Kumar and Vikas Kumar in May 2016, Pune-based LoanTap Financial Technologies provides a paperless experience coupled with speed and flexibility to the Salaried and Self Employed Segment. LoanTap has pioneered products like EMI Free Loans, Salary Overdraft, Rental Deposits and Credit Card Takeover which focus on the cash flow of Salaried Professionals and slash their EMIs by over 40%. 

LoanTap’s loan book has increased by 6.7X in the last 12 months. The company claims to have so far disbursed $14.5 million (Rs 100 Cr) to more than 5,000 customers, mainly for their personal requirements like travel and wedding expenses. It counts 35% of its customers from Bengaluru.

Satyam Kumar, Executive Director of LoanTap, said “We have been breaking new ground in the cluttered Salaried Segment by designing products which match the speed and spend patterns of the tech-savvy, instant consumption, modern day employee. This is the reason why our EMI Free Loans & Salary Overdraft are well received in the market. Unlike other FinTech startups we are focused on a profitable Loan Book. Even with experimentation, we have been able to keep our cash burn to a minimum and were able to become profitable in the second year of business itself.”

He further added, “In the last 2 years, we have built an enviable leadership team with retail banking veterans in Credit, Product and Collections. Strategically speaking, an in-house NBFC and Tech Platform gives us an edge on both the product design and delivery fronts. We are also rolling out three ‘Do it Yourself’ products in the Personal Loan Space and two Products in the consumer durable space this year.”

Tuck Lye Koh of Shunwei Capital said, “We are quite interested in the Personal Loan and Consumption Space in India and find it quite an under-penetrated market. LoanTap, with its strict Credit quality algorithm is well placed to capture this market.”

Shagun Kapur Gogia, Managing Director, Tuscan Ventures commented on this investment saying “Tuscan Ventures has been at the forefront of investing in innovation, especially around Financial services in India. We believe access to credit will be a major driver of growth in the country. LoanTap is a unique platform that uses technology to build and deliver innovative products in the personal loan segment. We believe that a good understanding of consumer credit coupled with a frictionless delivery process will help LoanTap provide a differentiated experience to its users.”

The company also benefits from the credentials of its leadership team. Satyam Kumar is a veteran in the banking industry. He held senior management roles and grew rapidly in ICICI Bank and IndusInd Bank, prior to founding LoanTap. Vikas Kumar is a serial entrepreneur and a veteran in the technology industry, having previously founded and exited a highly successful technology company.

Apart from LoanTap, other players operating in the consumer lending space include FlexiLoans, Lendingkart, KredX, Capital Float, and MoneyTap, among others.

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