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StashFin will use the fresh funds to grow in existing markets, expand across South Asia, and boost local language support on its customer platform.
Indian neobank StashFin has raised US$40 million in a Series B extension round, the startup announced in a statement yesterday. Neobanks are digital banks that provide banking and financial services, sometimes in partnership with traditional banks or financial institutions.
A mix of investors participated in the funding round, the statement noted. New investors included Altara Ventures and Uncorrelated Ventures, joined by Integrated Capital, Kravis Investment Partners, Saison Capital, and Tencent Cloud Europe BV. Other existing investors Alto Partners, Snow Leopard Ventures, and Positive Moves also participated.
StashFin will use the funding to expand across South Asia and bolster its growth efforts in existing markets, the statement said. The startup will also use the fresh funds to make its customer platform accessible in local languages, it added.
“During these difficult times, most aspiring consumers can avail the credit line to study further or serve immediate family needs for health and everyday consumption,” Founder and CEO of StashFin Tushar Aggarwal said.
“We are sitting on a unique opportunity to enable millions of consumers to get closer to their dreams and improve financial inclusion. South Asia is on the cusp of a financial revolution. Our mission is to use technology to enable frictionless banking and services,” he added.
StashFin offers an alternative credit facility
Founded in 2016, StashFin was acquired by Singapore-based Morus Technologies a year later. It currently has a presence in eight cities across India, according to the company website. The startup claims to have served over 250,000 customers to date.
StashFin offers a business to customer credit service through its Credit Line Card in partnership with Visa. StashFin customers can avail loans starting from INR1,000 (about $13) to INR5,00,000 (about $6800). The loans can be repaid through up to 36 monthly instalments. StashFin claims to charge “low” processing fees and no prepayment fees. Interest rates vary from 11.99% to 59.99% per annum.
The service comes with physical and virtual credit line cards that can be used for digital payments as well, the statement added. Features include 10 free ATM withdrawals, lifetime free annual fees, free supplementary cards, and Payback rewards.
“We believe that technology provides the means to financial inclusion and democratization,” Chairman and General Partner, Altara Ventures, Koh Boon Hwee said in the statement. “Despite the adverse macroeconomic conditions, we continue to partner with Tushar and his team; they are passionate founders, with a strong innovative product built on a robust technology platform that is addressing a huge market opportunity. We have seen explosive growth by StashFin over the last few years.”
StashFin is also backed by Managing Director at General Atlantic, Brett Rochkind, and Founder and CEO of Upgrade, Renaud Laplanche, the statement noted.
“It is often hard to find a combination of grit, resilience, determination and agility in a startup team. Equally rare is a clear vision and great unit economics,” said General Partner, Uncorrelated Ventures, Salil Deshpande.
He added that, “The team has built extremely compelling bank grade infrastructure in a frugal manner. The advanced machine learning and AI models can be scaled across various geographies.”
Neobanks are a growing trend in India, where access to formal credit is a major bottleneck to financial inclusion. In 2019, Indian neobanks raised $90 million in funding. Along with StashFin, startups such as Razorpay and Niyo, and banks such as Kotak Mahindra Bank, have been joining the fold.
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