Arth Padarth Factors and Finance Private Limited (AP Factors), non-banking financial company(NBFC) subsidiary of Artfine, has concluded a pre-seed investment round for an undisclosed sum. Manish Choksi’s family office, Jaspal Bindra (Chairman, Centrum Group), Ketan Gaikwad (Managing Director & Chief Executive Officer, RXIL), Nitin Gupta (Founder, Unicards), and Vivek Vishwas Patel are among the investors (Co-Founder, Go Payments).
Former bankers Arvind Rangarajan TCA, Saini Rajgopal, and Shantanu Bairagi are at the helm of the new fintech, which seeks to add supply chain financing to the asset classes already offered by Capital Markets in the form of CV pools and Microfinance. With its focus on the major SME / MSME area in India, AP Factors is the seventh Factoring NBFC in the country.
With the capital, AP Factors plans to improve its infrastructure, hire more people, and open offices all throughout the nation. It’s the eighth non-bank financial company in India to use factoring to get small and medium-sized businesses out of a financial bind. Next year, AP Factors anticipates that its AUM will grow to more than Rs 100 crore.
Saini Rajgopal, Co-founder of Artfine Advisory says, “Access to timely capital is critical for India’s manufacturing and service sector for growth. Several MSMEs supply regularly to well rated corporate clients but their growth is thwarted due to lack of working capital. We bridge the gap by factoring their receivables and releasing collateral free working capital. Further this portfolio of good quality receivables is offered as investment options in the form of Pass Through Certificates (PTCs)”.
According to the World Supply Chain Finance Report, the value of the supply chain has increased to $1.31 trillion in recent years, marking a considerable scaling of volumes. Increased use of digitally-led solutions by MSMEs and Corporates has the potential to boost the market’s CAGR to 17.1 % by 2024.
As of October 2021, when it first received its factoring license, AP Factors had already amassed a substantial pipeline of high-quality corporate receivables from its customer base, thereby validating its journey toward credit inclusion for micro, small, and medium-sized enterprises (MSMEs) and putting it in a strong position to reach an AUM of more than INR 100 crs in the coming year.
Artfine has previously acted as India’s first dealer financing securitization and India’s first supply chain covered commercial paper advisor. The leading banks and NBFCs have joined up with the fintech company to serve as M&S lenders.
“India TReDS platforms have seen leap frogging factoring volumes in the last fiscal. AP Factors is well positioned as a Factoring NBFC to ride this wave with its innovative solutions for SMEs and MSMEs,” says investor Ketan Gaikwad (MD & CEO, RXIL).