NBFC firm Aye Finance raises Rs 250 crore led by Singapore’s ABC Impact, BII

Indian NBFC firm Aye Finance has raised Rs 250 crore ($30 million) in a Series G funding round led by Singapore’s ABC Impact, with participation from British International Investment (BII), a UK-based development finance institution.

The funding marks the first investment from ABC Impact’s Fund II.

Prior to this, Aye Finance raised Rs 310 crore in a Series F round led by BII in December 2023. The round brings its all-time raise to Rs 1,250 crore.

Purpose of fundraising

Sanjay Sharma, Founder and Managing Director of Aye Finance, said, “We are excited to announce our Series G equity round. We have been fortunate to have stellar names from the industry partner with us in our mission to enable financial inclusion of the underserved segment right since 2014. We are delighted to partner with ABC Impact in this round and look forward to maximising impact."

Sharma said the capital infusion will enable the firm to scale operations and enhance its ability to deliver value to the target segment of micro-enterprises.

Investor comments

ABC Impact, a Temasek-backed impact investor, manages over $850 million in assets. The investment aligns with its mission of addressing critical global challenges, including financial and digital inclusion.

Sugandhi Matta, Chief Impact Officer of ABC Impact, expressed enthusiasm for the partnership with Aye Finance, noting, “India is a country of micro-entrepreneurs. However, this important segment of the economy is significantly underserved by formal credit.”

"Our partnership with Aye Finance will support these micro-entrepreneurs with better access to credit so that they can grow their businesses and realize their full potential," Matta added.

ABC Impact invests in companies that drive positive change in areas like financial inclusion, climate action, and sustainable agriculture.

Aye Finance’s expanding reach in MSME lending

Founded in 2014 by Sanjay Sharma and Vikram Jetley, both former operators at Ujjivan Finance, Aye Finance has established itself as a key player in the MSME lending space, offering working capital loans to micro-enterprises.

The firm claims to have over 478 branches across the country. Its proprietary underwriting approach evaluates businesses based on cash flows, providing better insight into their financial health.

Aye Finance offers three main loan products—quasi-mortgage loans, hypothetical loans, and add-on loans—with loan amounts ranging from Rs 50,000 to Rs 1,000,000. 

Financial performance

Aye Finance has delivered a robust financial performance in recent years. In FY23, the company saw a 44.5% revenue growth, reaching Rs 623 crore, with a profit of Rs 54 crore.

In FY24, the firm reported an impressive 198% increase in profit, reaching RS 161 crore, while revenue surged by 67% to Rs 1,072 crore.

As of FY24, Aye Finance’s assets under management (AUM) stood at RS 4,500 crore, with a gross non-performing asset (NPA) ratio of 1.21%.