GrowX Ventures leads seed round in online lending startup Progcap

New Delhi-based online startup Progcap, which offers working capital to small businesses, said it has raised Rs 7 crore ($1 million at current exchange rate) in a seed funding round led by GrowX Ventures, which is an early-stage venture capital firm focused on business-to-business and deep-tech companies.

Contrarian Drishti, along with angel investors Somak Ghosh and Abhishek Dalmia, also participated in the round.

The fresh capital raised will be used towards scaling up Progcap’s Last Mile Retailer Finance Platform.

Owned by Desiderata Impact Ventures Pvt. Ltd, Progcap provides access to customised financing solutions through data-driven credit scoring.

Through its Last Mile Retailer Finance Facility, Progcap provides under-banked, semi-urban and rural retailers in India access to flexible, collateral-free working capital.

Progcap was founded by Pallavi Shrivastava and Himanshu Chandra in 2017 after years of working on the ground with small businesses in their respective jobs. Shrivastava has a background in development finance, having worked in organisations including International Finance Corporation and its parent World Bank. Chandra’s experience spans over a decade in the financial services industry, having served institutions such as Standard Chartered, Barclays and Carlyle Group.

Progcap’s vision is to broaden the opportunities for businesses in the last mile. There are over 20 million retailers in India that are unplugged from formal financing, said Progcap. The firm is working towards building a platform to integrate these businesses into the real economy, said Progcap founders.

Deals in the space

• March 2019: Microlending startup RedCarpet Tech Pvt. Ltd secured $3.89 million in a fresh funding round from Lightspeed India Partners.
• March 2019: Microlending platform SMEcorner raised Rs 90 crore ($12.8 million then) in debt and equity funding.
• February 2019: Online platform ZipLoan raised Rs 90 crore ($12.5 million then) in a Series B funding round led by SAIF Partners.