Revenue-based financing startup GetVantage secures NBFC licence from RBI

NBFC arm GetGrowth Capital will run the lending operations for GetVantage and dole out financing to small and medium enterprises (SMEs) and new economy businesses. The NBFC will get Rs 50 crore equity from GetVantage, which then plans to raise Rs 200 crore as debt to scale up lending operations.

GetVantage is backed by investors including Chiratae Ventures, Varanium and Japanese investors such as Sony Innovation Fund and Dream Incubator, and competes with the likes of Klub, Velocity and N+1 Capital.

“We are excited to have secured an NBFC license from the RBI, which reinforces our commitment to providing innovative and accessible financing solutions to the emerging SME sector in India. Being unlicensed is not an option,” said Bhavik Vasa, founder and chief executive officer (CEO) of GetVantage.

Founded in 2019 by serial entrepreneur Bhavik Vasa, GetVantage helps businesses access non-dilutive working capital for their capital expenditure needs including inventory, logistics and other recurring expenses. It currently claims to be catering to businesses across 18 sectors including software-as-a-service (SaaS), cleantech, ecommerce, direct-to-consumer, eclectic vehicles, infrastructure and cloud-kitchen categories.

With the NBFC now in the fold, GetVantage is looking to hit annual disbursements of over Rs 500 crore in short-term working capital finance and help over 1,000 SMEs with funding in the next 18 months. The fintech claims to have facilitated funding for over 500 new economy businesses over the past 18 months.

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Several lending fintechs over the past few months have been racing to either procure a direct NBFC licence from the regulator or do so through making inorganic acquisitions.The regulator’s approach to the much-awaited digital lending guidelines last year made it clear that fintechs need to be regulated in a bid to have a greater say in the overall digital credit cycle. Further, owning a direct licence would allow these fintechs to not be reduced to a loan-service provider (LSP) or distribution agent, but help them expand their revenue margins while having more control over the capital disbursed.

Having said that, many fintechs are expected to also continue co-lending models with partners to spread credit risks across.

Earlier this week, New Delhi-based fintech BharatPe acquired a majority stake (of 51%) in Mumbai-based NBFC Trillion Loans in an effort to boost its lending business.

ET reported on Monday that Kunal Shah-backed Cred is bolstering its credit play as it looks to raise separate capital for its NBFC Newtap Technologies. Neobanking startup Jupiter was granted an NBFC licence by the RBI, ET reported exclusively last week.