Knight Fintech Pvt Ltd, a Mumbai-based startup that helps banks issue loans, has closed a $23.6 million funding round.
The Economic Times reported late Thursday that Accel led the investment. It was joined by IIFL, Rocket Capital, Prime Venture Partners, 3One4 Capital, Commerce VC and Trifecta Capital. Knight Fintech has raised a total of $30 million since launching in 2019.
Banks issue some loans in partnership with other firms under a model called co-lending. For example, a financial institution might partner with a fintech startup to launch an app-based credit product. The two companies involved in a co-lending transaction transfer the principal of the loan to an escrow account, which is then used to disburse funds to the borrower.
Knight Fintech’s flagship offering is a suite of tools for managing co-lending partnerships. According to the company, banks can use it not only to issue loans but also to carry out the subsequent administrative work. The software generates dashboards that make it easier to track loan health. Additionally, it automates some of the tasks involved in account reconciliation, the process of verifying that debt-related accounting records are accurate.
Knight Fintech says that its platform also lends itself to supply chain finance. That’s a term for credit products geared toward the manufacturing sector. They allow a company that hasn’t yet been paid for its merchandise to access liquidity early.
Another Knight Fintech product, Aurix, helps banks build customer-facing financial apps. It provides software building blocks that ease tasks such as onboarding new users and providing technical support. A feature called Aurix Chat enables consumers to submit loan applications via WhatsApp.
The company’s third product is Beacon, a platform that organizations can use to manage their finance assets. According to Knight Fintech, the software makes it easier to identify financial risks in an enterprise’s investment portfolio. There’s also a simulation tool that enables accounting teams to test new investment strategies before putting them to use.
“Our co-lending and treasury management platforms are already operating at meaningful scale, while embedded finance and digital lending are accelerating rapidly,” said founder and Chief Executive Officer Kushal Rastogi.
The company generated about $3.4 million in revenue last year. It plans to significantly grow that sum through 2030. According to the Economic Times, Knight Fintech hopes to pass the $85 million annual revenue mark within the next four years and increase the value of its assets under management to more than $50 billion.
Image: Unsplash
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