Seeds Fincap secures over $8.5M in series a funding led by Lok Capital and Matrix Partners India

New Delhi: Seeds Fincap Pvt. Ltd., a non-banking financial company (NBFC), has raised over Rs 71 crore in a Series A funding round led by Lok Capital and Matrix Partners India, also known as Z47. The funds are earmarked for expanding Seeds Fincap's lending capabilities, upgrading its technological infrastructure, and broadening its branch network. The MSME (Micro, Small, and Medium Enterprises) sector in India, which includes manufacturing, trading, and allied services, faces a credit deficit exceeding ₹8 trillion. Traditional financial institutions often overlook this sector, necessitating specialized lenders with extensive branch networks and robust on-ground collection capabilities.

Founded in 2021 by Subhash Acharya and Avishek Sarkar, Seeds Fincap offers secured and unsecured loans to MSMEs, with loan sizes ranging from Rs 1–5 lakhs. The company employs a rigorous credit assessment process to evaluate cash flows and provide appropriately priced loans, leveraging technology to monitor risk and reduce operating costs.

In just three years, Seeds Fincap has established a network of 90 branches across eight states, including major operations in Uttar Pradesh, Bihar, Rajasthan, and Haryana. The firm has disbursed over ₹600 crore in loans to more than 50,000 customers, expanding its loan book to over ₹330 crore. It boasts a diversified liability base with partnerships involving 35 lenders, such as AU Small Finance Bank, Tata Capital, IDFC Bank, Yes Bank, and Vivriti Capital.

Subhash Acharya, Managing Director and Co-Founder of Seeds Fincap, emphasized the critical need for tailored financial solutions for MSMEs. "MSMEs in India continue to be underserved on credit, often overlooked by incumbent financial institutions. Our partnership with Matrix Partners India and Lok Capital signifies a shared dedication to unlocking the immense potential within the MSME segment."

Avishek Sarkar, co-founder, highlighted the diversity of their clientele. "Our clients range from traders and small kirana shops to owners of micro-manufacturing units and allied service providers. Over the last three years, we have developed expertise in assessing their cash flows and underwriting these businesses."

Vikram Vaidyanathan, Managing Director at Matrix Partners India, noted the opportunity in MSME credit as essential to India's growth towards a 10 trillion dollar economy. Rajat Bansal, director at Lok Capital, expressed confidence in Seeds Fincap's growth prospects, emphasizing their focus on credit and risk management.