FlexiLoans, a digital lending platform for small businesses, has raised 375 crore rupees (US$45.2 million) in its series C funding round.

The round was led by existing investors Fundamentum, Accion Digital Transformation, Nuveen, and Maj Invest, with participation from British International Investment (BII), a UK-based development finance institution.

The funding includes primary equity for operational growth and secondary transactions for investor liquidity, the company announced on June 11, 2025.

The company plans to use the funds to expand operations, enhance product development, and strengthen its technology infrastructure.

Founded in 2016 by Deepak Jain, Ritesh Jain, and Manish Lunia, FlexiLoans offers financing solutions to Micro, Small, and Medium Enterprises (MSMEs) across India.

🔗 Source: YourStory

🧠 Food for thought

1️⃣ FlexiLoans’ growth mirrors the expanding digital lending revolution in India

FlexiLoans has demonstrated remarkable growth since its founding in 2016, increasing its loan portfolio from approximately ₹500 crore in 2019 to over ₹10,000 crore today across 170,000+ loans1.

This trajectory reflects the broader digital lending expansion in India, where digital lenders collectively disbursed over ₹50,000 crores to SMEs in the last financial year alone—a 30% year-over-year increase2.

The company’s focus on technology has yielded significant efficiency gains, with its proprietary machine learning engine capable of analyzing 10,000 data points about a company in just 30 seconds, dramatically accelerating loan approvals compared to traditional banks’ 200-step manual processes1.

FlexiLoans has successfully maintained quality while scaling, with a reported bad loan ratio of less than 3% as of 2019, suggesting effective risk management through its advanced analytics approach1.

The company’s partnerships with major platforms like Flipkart, Amazon, Paytm, and PhonePe align with the industry trend of leveraging alternative data sources for credit assessment, a strategy that’s helping digital lenders better serve previously underbanked businesses.

2️⃣ Addressing India’s massive MSME credit gap remains a critical economic challenge

Despite FlexiLoans’ progress, it operates within a market facing an enormous financing shortfall, with reports estimating the MSME credit gap between ₹20-30 lakh crore (approximately $240-360 billion)34.

This gap persists despite MSMEs’ crucial economic role, with credit penetration for Indian MSMEs at just 14%—significantly lower than China (37%) and the United States (50%)3.