Capital India invests $25m in education lending fintech platform Credenc

Capital India Financial Limited (CIFL), an Indian finance conglomerate, has invested $25 million in education lending fintech platform Credenc to add another business to its portfolio.

The investment, which will be made in mixed equity and debt, is said to align with Capital India’s objective to make digital financial products and services available to customers in India.

With the investment, Credenc plans to build a book of INR 3,000 crores by the year 2025.

Avinash Kuma – Co-founder of Credenc said: “Our partnership with Capital India is very strategic, it will give us both balance sheet and cost of capital advantage which will help in disrupting the education lending segment by providing loans to students who were until now ignored, helping lakhs of Indian students achieve their potential ”

Founded in 2017 by Avinash Kumar and Mayank Batheja, the New Delhi-based fintech company operates as a technology led education loans platform. It is said to serve as the digital finance desk of more than 1,000 colleges across 17 Indian cities.

Credenc provides education loans, which cover K-12 school fee, higher education, online upskilling courses and also abroad study courses at the click of a button.

The education lending fintech platform is expected to shortly launch a student focused neo bank in India. Presently, Credenc is said to be building the entire student education ecosystem by helping students and parents with credit, employability, accommodation, savings, Forex, and investments through its mobile app.

Capital India invests $25m in education lending fintech platform Credenc. Photo courtesy of PublicDomainPictures from Pixabay.

Credenc carries out its loan evaluation process by using an artificial intelligence (AI) model that is said to track 15 million data points for predicting the future income of students seeking loans.

The fintech company offers financial assistance based on the potential of students and future income rather than the existing financial capability of their families.

SK Narvar – promoter of Capital India said: “The annual spend on college fees in India is around US $50 billion or INR 3.5+ lakh crore, of which only 5% is financed by organised lenders.

“With Credenc, CIFL intends to change the segment perception and reduce underwriting risk basis Credenc’s future employability score, which will help this percentage go up to at least 15%, aiming to lend 3000 crores by 2025. Also, the founders will continue to run operations for Credenc as we would not want to disrupt the working of the organisation and believe they know the business best.”