Payment solutions firm Innoviti raises $5M from Catamaran, New India Investment to ramp up SME lending

IT tsar NR Narayana Murthy's investment arm Catamaran Ventures has invested $5 million (over Rs 30 crore) in Bangalore-based payment solutions firm Innoviti Payment Solutions Pvt Ltd along with Canada-based New India Investment Corporation.

Innoviti will use the money to expand its business of real-time distribution of credit to small and medium enterprises (SMEs), the company said in a statement. The funding will also be used for marketing, product development and for scaling up its overall payments infrastructure, Innoviti said.

"Our ability to extend loans for SMEs in real-time at their points of purchase solves a real-world SME lending problem.  We are eager to use this round of funding to rapidly scale our presence," said Rajeev Agrawal, CEO, Innoviti.

Innoviti was founded in 2002 by Agrawal, who holds B Tech and PhD from IIT Bombay. Earlier, he worked at Sasken Communications in Bangalore. Prior to that, he was a research assistant at Raman Research Institute, Bangalore.

Innoviti started its payments business in 2008 and uses a patented payments platform. The company processes payment transactions worth over Rs 8,000 crore and originates loans worth over Rs 1,000 crore. It claims to have technological capability to process payment transactions across online and offline channels.

Innoviti had raised Rs 10 crore through debt and equity in its previous round of funding last year from Tata Capital and other investors.

The company claims it distributes over Rs 400 crore of loans to more than 10,000 SMEs across 20 cities through multiple lenders annually.

Launched in 2009, Catamaran has done a string of investments in the past few years in public and private companies. Its portfolio includes names such as Ace Creative Learning Private Ltd, Big Shoe Bazaar India Private Ltd, Hector Beverages Private Ltd, NRB Bearings Ltd, SKS Microfinance, TD Power Systems, Taurus Business and Trade Services, Wellspring Health Care Private Ltd, according to VCCEdge, the data research platform part of VCCircle.

"Catamaran chose to partner with Innoviti because we were attracted to the company's merchant-oriented approach to credit distribution built on top of a robust payments platform," said Abhishek Laxminarayan, director, Catamaran Ventures.

Bhaskar Bhat, managing director of Titan Ltd, said: "Our initial interest was in developing some technology enhanced products but later reduced to that of a financial investor in what has proved to be a company at the cutting edge of a much needed payments platform."

Innoviti counts Reliance Retail, Star Bazaar, Next, eZone, Croma, UniverCell and Titan, among others, as clients.