Techfin firm Crediwatch raises Rs 23 crore Series A funding

Crediwatch, a Bengaluru-based fintech company has raised about Rs 23 crore (US$ 3.2 million) in Series A funding.  The company helps the financial services industry in reducing credit risk by using artificial intelligence (AI) and machine learning (ML) tools.

According to Meghna Suryakumar, founder and CEO, this is the fourth round of funding for the company.

Ms. Suryakumar said that the funds raised will be utilised to increase the research and development (R&D) and commercialisation of AI platform and to get more clients.

Artis Labs led the current round of funding. The new investors in the round consist of Abstract Ventures. 

The funds raised by the company earlier where about Rs 10 crore (US$ 1.6 million) from Modern India Limited, family offices of VK Jatia, Contrarian Vriddhi Fund, Vaibhav Domkundwar of Better Capital, Mekin Maheshwari (Flipkart), and Pithambar Gona (former MD of Blackstone Private Equity Asia). Crediwatch has developed an early warning system (EWS) for banks and non-banking financial companies (NBFCs) that can help monitor their loan portfolios in near real-time by using both public and private data.

The offering from the company take the background consideration of the huge number of bad loans at most of India's banks and non-banking financial companies (NBFCs).

The system is used by State Bank of India, Karur Vysya Bank, Aditya Birla Finance, and RBL for credit appraisal.

There is less than 15 per cent of the over five crore small businesses in India that have access to formal credit, as per the company. Thus, it offers a dynamic 'Trust Score', which is derived from millions of data points that are extracted and analysed from across thousands of formal and alternative sources to help lenders assess borrowers and monitor them at near real-time.

This needs a dynamic business information exchange which can help in creating transparency and borrowers are monitored continuously with a view to remove bad cases early on. "Our work helps measure trust through verifiable data, insights and good behaviour," said Suryakumar.

In order to test the new system, credit review process, Crediwatch began working with SBI in the October to December quarter of 2018. After which it was onboarded with SBI starting January 2019 and from the current financial year, Crediwatch has a full-fledged relationship with SBI. Every proposal is viewed by the team based in Mumbai that is given by every branch for a certain value.

"SBI is leading the way for others; they are ensuring that issues (of bad debt) don't arise or repeat," said Suryakumar.

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