TruCap Finance Limited (TRU) has made an announcement mentioning a binding agreement to raise up to Rs. 105 crore (nearly US$13.1 million) in a combination of equity shares, convertible warrants, and non-convertible debentures from Zeal Global Opportunities Fund.
As per the communique, the fund raise would include Rs. 80 crore of equity and convertible warrants, and around Rs. 25 crore would be infused via NCDs in the company.
Commenting on this development, Rakesh Sethi, Chairperson of the Board of TruCap commented, “We are delighted to bring on-board Zeal Global Opportunities Fund and appreciate their belief in TRU’s potential to tap the unmet MSME credit demand in India. The current funding round once completed will enhance the Company’s equity base to approximately Rs. 325 Cr. This will invigorate TRU’s efforts to build business at a greater scale with speed, while we continue what we do best, which is to empower small business owners by enabling credit inclusion through Lending-as-a-Service (L-a-a-S), with a robust risk management framework.”
“Focusing on an omni-channel approach and prioritizing customer centricity, TRU has evolved its ability to address multiple pain areas faced by underserved borrowers to access growth capital. It has managed to bridge the credit gap left unaddressed by traditional lenders in the MSME clusters of India. Having proprietary data acquired via disbursement of more than 100,000 loans, TRU has significantly reduced turnaround time, scaled sourcing capabilities, refined the qualification processes, and collections strategies for small businesses lending. We are impressed by TRU’s impact-led inclusion metrics demonstrated by serving new-to -credit borrowers and small entrepreneurs in tier 2 and 3 cities resonating with its motto of building lives and livelihoods,” said Mr. Ritesh Abbi, CEO, Zeal Global Opportunities Fund.
Besides, TRU proposes the integration of the retail MSME lending vertical of Exclusive Leasing & Finance (EZ Capital) with itself.
EZ Capital is a North India based NBFC, focused on offering secured and affordable finance to the MSME sector in India.
V.K. Bhandari, Chairman of EZ Capital remarked, “The combined expertise will foster deep sourcing, distribution, and servicing capabilities to build a pristine quality loan book, via L-a-a-S partnerships with banks and financial institutions to support inclusive economic outcomes for all. We look forward to leverage on each other’s strengths to build customer centric solutions and accomplish our resolve to promote financial inclusion. I am particularly excited about utilizing and building on each other’s internal domain knowledge and processes to create more resilient systems while harnessing growth, sustainability and keeping portfolio quality robust. This is an opportunity to offer wings to aspirations of countless micro, small and medium entrepreneurs in non-metros to herald a new chapter in the country’s growth story at a global stage, riding on tailwinds of improving economic activity.”
“We are very excited to partner with Zeal Global and EZ Capital in our mission to make a deep societal impact by providing access to timely and affordable finance to MSMEs in semi-urban and rural areas. This development will fortify TRU’s AUM, net-worth, and profitability. An enhanced equity base will further bolster our mission to address the rapidly increasing credit demand at the grassroots, especially with our recent expansion in Gujarat, which increases our presence to 7 States,” said Rohan Juneja, MD & CEO at TruCap Finance Limited.