Namdev Finvest Secures $19 Million Funding to Expand Financial Services in Rural India

NBFC Namdev Finvest
Preeti Bali / 2:01 pm / April 9, 2024

Namdev Finvest, a non-banking financial institution (NBFC) dedicated to supporting Micro, Small, and Medium Enterprises (MSMEs), has achieved a significant milestone by closing a pre-Series C funding round worth $19 million. The investment was spearheaded by Maj Invest Financial Inclusion Fund III K/S, a renowned private equity firm, with additional participation from Namdev Finvest’s founders and employees.

This fresh infusion of capital will empower Namdev Finvest to accelerate its expansion plans, particularly in recently added rural areas. Jitendra Tanwar, the company’s Managing Director & CEO, expressed his enthusiasm about the funding, underlining its significance in extending their reach and making a positive impact in underserved communities.

Serving the Unbanked: A Core Focus

Established in 2013 by Tanwar, Namdev Finvest has carved a niche in providing financial services across seven North-Western states of India. The company prioritizes serving the underbanked population residing in rural and semi-urban areas, who often have low formal income and limited credit history. Namdev Finvest offers a tailored suite of solutions, including business loans designed specifically for MSMEs and green financing options such as loans for electric vehicles and solar energy solutions.

Building a Strong Foundation: Growth and Impact

With more than 100 locations and a strong network, Namdev Finvest has effectively distributed over 50,000 loans, with amounts ranging from Rs 4 lakh to Rs 7 lakh, mostly to assist income-generating ventures. This has resulted in an impressive accumulation of Assets Under Management (AUM) exceeding Rs 1,120 crore.

Maj Invest Financial Inclusion’s Director, Siva Vadivelazhagan, emphasized the company’s dedication to bolstering Namdev Finvest’s established performance history. He specifically commended their tech-driven loan assessment process and cost-effective approach to funding. Maj Invest, a Danish asset management firm managing approximately $12 billion, serves as the lead investor in this funding round.

A Thriving MSME Landscape: A Promising Future

Namdev Finvest’s expansion endeavors align with a noticeable shift in the MSME landscape. As per the February 2024 TransUnion-CIBIL MSME Pulse report, nearly half (46%) of all MSME loan originations during the July-September 2023 quarter originated from semi-urban and rural regions. This growth is further amplified by improvements in the creditworthiness of MSMEs, as evidenced by a decline in high-risk profiles.

Furthermore, data provided by Bhanu Pratap Singh Verma, Minister of State in the MSME Ministry, indicates a reduction in gross NPAs (Non-Performing Assets) within the MSME sector. This underscores the sector’s resilience and immense potential for further growth.

The successful funding round secured by Namdev Finvest signifies not only investor confidence in the company’s vision but also the burgeoning opportunities and critical role of financial inclusion in empowering India’s MSME sector.

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