PayU, the financial technology arm of Prosus NV, and Alpha Wave Incubation led the fundraising, which also saw the participation of Better Tomorrow Ventures, 3one4 Capital and Rainmatter Capital as well as existing investor Leo Capital.
The capital will be used for expanding operations across the country in the next two years.
Founded in 2020 by Nitin Misra and Deepak Abbot, Indiagold essentially gives customers the option to store gold in lockers at much cheaper rates than traditional banks. The New Delhi-based company also offers a credit line for the deposited gold.
“India offers a large $650 billion addressable gold loan market which is highly fragmented and currently dominated by the informal segment,” Abbot and Misra said in a statement. “Even the formal segment hasn’t adopted digital practices at scale. Indiagold’s suite of financial products bridges this critical need gap…”
Indian financial institutions struck gold, quite literally, as the Covid-19 pandemic triggered a surge in loans against jewellery since early last year,
according to a S&P Global report.
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Indiagold was founded against this backdrop.
“Empowering disruptive fintech entrepreneurs through early-stage investments is a key element of PayU’s growth strategy,” said Vijay Agicha, global head of strategy and growth at PayU. “By supporting businesses that complement our existing portfolio, we aim to achieve our vision of developing a fintech ecosystem that will meet the financial services needs of millions of Indians.”
The World Gold Council
expects the gold loans market to grow at an annual rate of 15.7% and reach Rs 4.617 lakh crore in FY22 from Rs 3.448 lakh crore in FY20. Indian consumers are sitting on a $1.5 trillion hoard of the yellow metal, according to the council’s estimates, mostly in the form of ornaments that are passed down for generations.
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