Xtracap Fintech India has raised $1 million (Rs 7.56 crore) in an angel round of funding, the Gurugram-based startup announced on Wednesday.
While the three-year-old company did not disclose names, it said that the capital had been raised from a clutch of US and UK-based investors. Xtracap Fintech will use the proceeds to increase product offerings on its app, strengthen its IT infrastructure and increase its distribution capability.
The startup, which was founded by Mohammed Riaz and Nishant Singh in May 2017, also plans to launch additional digital solutions, including, payments, order management, logistics, insurance and financial services, along with an accounting platform, by March 2021, it said in a prepared statement.
Xtracap Fintech owns and operates an invoice financing platform Bridge2Capital, which helps retailers in small towns and cities connect with banks and NBFCs to access short-term liquidity. It offers loans in the Rs 50,000-Rs 5 lakh range, with a credit period of 45 days and a daily repayment schedule.
“We aim to provide a digital ecosystem in about 1,500-plus towns and cities with high consumer demand. With increase in digital adoption, this time period will shrink in the future due to the unprecedented Covid-19 situation,” Riaz, founder and chief executive of Xtracap Fintech, said.
The company, which claims to have seen 30,000 registration since inception, is looking to onboard 20 lakh retailers by 2028. It plans on raising its pre-Series A funding round over the next 12 months, according to the company-issued statement.
“As there is a structural shift from cash-based to short credit-based economy in emerging markets, startups like XtraCap are pivotal to the changing landscape. With a huge market opportunity in front of them, their business model is redefining supply chain invoicing through digitisation and convenience, thus eliminating barriers for access to cash and unleashing small business’ potential to grow,” an investor in the latest round, said.
The startup, which was incubated under the Bharat Inclusion Initiative, managed by Centre for Innovation Incubation and Entrepreneurship – IIM Ahmedabad, also claims to have managed Rs 70 crore worth of invoice financing for over 1,000 small shopkeepers, spread across Rajasthan, Punjab and Telangana, according to the official statement.