Online lending startup LoanTap has closed its third round of equity funding of $6.25 Million led by Shunwei Capital. Other investors like Tuscan Ventures, Ashish Goenka, and existing investors like India Quotient and Kae Capital also participated in the round.

After closing its latest round of funding, LoanTap has cumulatively raised over $20 million in debt and equity, the company said in a statement. It added that it plans to leverage an additional $30 million in debt this year. It is common for lending companies to raise debt funding to replenish their loan book. 

Satyam Kumar, Executive Director of LoanTap said that the company will be rolling out three ‘Do it Yourself’ products in the personal loan space and two products in the consumer durable space this year

Founded in 2016, by Satyam Kumar and Vikas Kumar, the Pune-based company provides loans to salaried and self-employed segment. It offers something known as EMI-free loans where the applicants have to only serve monthly interest on the loan outstanding, while users can schedule principal payments, based on their projected incentive or bonus credits.

In terms of growth, it said that its loan book has increased by 6.7 times in the last 12 months and that it became profitable last year.

Previous funding

In June 2017, LoanTap raised $4 million in a round of funding with a mixture of debt and equity funding from Kae Capital, India Quotient, IFMR and MAS Financial Services Ltd. Equity infusion to the platform was led by Kae Capital, with participation from its existing investors including India Quotient and HNI Investors. On the other hand, debt was raised from leading non-banking financial companies (NBFCs) such as IFMR and MAS Financial Services.

It had earlier raised $3 million in a Series A round of funding from HNIs, including Abhishek Pandey and Jaysukh Sapra back in August 2016.

Recent development in lending space

The digital lending space is crowded with players like CoinTribe, NeoGrowth, Paytm-backed CreditMate, CASHe, LendingKart, MoneyTap, EasySalry, Faircent, LoanMeet amongst others.

In June, CoinTribe raised Series B funding $10 million led by Sabre Partners along with participation from existing investor, Puneet Dalmia.

In May, Capital Float raised debt funding of 6 million euros (₹48 crores) from the Netherlands- based asset management company, Triodos Investment Management (Triodos IM), a wholly-owned subsidiary of Triodos Bank. This was a week after it raised $22 million (Rs 144 crore) from e-commerce giant Amazon & existing investors.

Times Internet has also tapped this space as ETMoney launched a new service called CreditLine on its platform, in partnership with RBL Bank.

Even, California-based fintech company Tala said that it is bringing its lending app to India. This expansion was announced along with a new $50 million Series C funding.

Payments company Mobikwik is also gearing up to tap lending space. It recently announced the appointment of Vinayak N as its new head of the Lending Business at MobiKwik. Vinayak will help the company to kick-start the lending business for MobiKwik.