Kalaari Capital, an early-to-mid-stage venture capital firm invested a Rs 13.3 crore funding in Mumbai-based startup CreditVidya. Creditvidya is a financial technology startup Infocredit Services, which operates credit score advisory platform. It has also received additional 1 crore from Paragon Partners, Siddharth Parekh, an early backer of the venture of the creditvidya in his personal capacity.
The company will use the Series A funding to further build its technology platform, launch new products and expand its headcount, with a particular focus on ramping up its data sciences team.
“India’s demographic profile consists primarily of people without a credit history. CreditVidya’s solutions enable lenders to increase profitability by more accurately assessing the credit risk of these new-to-credit customers,” Rajiv Raj, Co-founder of CreditVidya said.
“Credit scoring is a major bottleneck in India inhibiting social and economic growth. CreditVidya has built unique technology that enables lenders to assess credit risk of 800 million-plus Indians not covered by traditional credit scoring,” said Bala Srinivas, partner at Kalaari Capital.
“This is an important milestone for the company and I am excited about this next phase of the journey. The team brings deep domain expertise around credit underwriting analytics, and are well on their way to building a world-class alternate underwriting platform,” Siddharth Parekh said.
CreditVidya was founded in 2013 by Abhishek Agarwal and Rajiv Raj, who has experience of working in leading banking and financial institutions. CreditVidya uses big data and advanced machine learning techniques to provide credit scores to consumers, banking and financial institutions.
The startup typically earns its fee by charging lenders for every credit score requested by them. CreditVidya counts financial institutions, such as, Fullerton India, Bajaj Finserv, IDFC Bank, Tata Capital and Shriram Housing Finance, among its clientele.
While still a relatively new concept in India, a number of fin-tech startups have begun to provide credit scores to clients. Delhi-based IndiaLends, which has been backed by DSG Consumer Partners, and also counts Parekh as an angel investor, is another venture the offers the service as well.