NABARD fund makes first investment in fintech startup Jai Kisan

NABVENTURES Fund I, the investment arm of agriculture and rural development institution Nabard made its maiden investment in Mumbai-based rural fintech start-up Jai Kisan as part of a Rs 30 crore (US$ 4.26 million) funding round.

The pre-Series A round of funding was led by Arkam Ventures (formerly Unitary Helion) along with participation from existing investors Blume Ventures, Prophetic Ventures and Better Capital. The round also saw investments from other investors including The Chatterjee Group (TCG), Mr Rajiv Sahney of New Vernon Capital LLC and Mr Sanjay Mariwala of OmniActive Health Technologies.

NABVENTURES was launched in May 2019 with a proposed corpus of over Rs 500 crore (US$ 70.93 million).

Jai Kisan plans to use the funds in hiring across roles in operations and process management, as well as invest in its technology platform, as it plans to offer newer financial services.

The start-up was founded by Mr Arjun Ahluwalia and Mr Adriel Maniego and is a technology platform which focuses on offering credit as well as a suite of financial products to the rural economy. It partners with equipment dealers, agriculture retailers, collection centers and market linkage platforms, to directly provide credit to farmers, working in the agriculture, poultry, and dairy value chain.

“Adriel and I started Jai Kisan to facilitate rightly priced credit (and other financial services) to rural borrowers. Over the past few months, we have built a diverse book while ensuring delivery of credit instantly and more importantly – cheaply, across 10 states including the most backward parts of the country." said Mr Arjun Ahluwalia, co-founder and CEO of Jai Kisan.

He added that these direct loans to farmers provide aid to build their credit profile and history, making it easy to access direct loans and financial services for them in the future.

In the last six months, Jai Kisan said it has disbursed over Rs 50 crore (US$ 7.09 million) in working capital loans to more than 5,500 farmers across various income groups from 10 states.

The interest rates for loans offered by Jai Kisan stands at 16 per cent-18 per cent, with the company presently partnering with 3 banks and 5 NBFCs including Avanti Finance, which is backed by Ratan Tata and Nandan Nilekani.

“Very few start-ups have the commanding view of a large untapped space. Even fewer start-ups have the luxury of tail winds in these challenging times. Jai Kisan is a rare combination of both of the above along with a unique business model that adds value to multiple participants of the agri supply chain", said Mr Rahul Chandra, Managing Director of Arkam Ventures.

“We appreciate the efforts of Jai Kisan to emerge as a frontline agri/rural fintech player on the strength of its tech prowess, low cost of operations along with reasonable security levels," said Mr G.R. Chintala, chairman, Nabard.

It has also been disbursing close to Rs 8 -12 crore (US$ 1.13-1.70 million) in credit monthly, with average ticket sizes ranging from Rs 50,000 to Rs 1 lakh (US$ 709.32 to 1,418.64).

“Jai Kisan is charting a new course in agri-rural digital lending. Even in a COVID scenario, it has delivered stellar growth. NABVENTURES would continue to back such tech-driven agri/rural start-ups which are at the forefront of agri/rural transformation in India," said Mr Rajesh Ranjan, CEO of NABVENTURES.

The company is also operating closely with banking partners to expand their offerings of insurance and saving products to farmers in the rural economy. It expects to expand its services to eastern and north-eastern parts of India in next six months and take the total loan book size to Rs 150 crore (US$ 21.28 million).

 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.