Chennai-based non-banking financial company (NBFC) GrowXCD Finance has secured INR 50 crore in fresh funding from venture capital firm Lok Capital and UC Impower, strengthening its position in the MSME lending sector. The investment, split between Lok Capital (INR 20 crore) and UC Impower (INR 30 crore), marks a significant milestone in the company’s growth trajectory since its founding in 2022.
This latest funding round has increased Lok Capital’s total investment in GrowXCD Finance to INR 70 crore, demonstrating strong investor confidence in the NBFC’s business model and growth potential. The fresh capital injection has boosted GrowXCD’s net worth to INR 110 crore, positioning it for substantial expansion in South India’s MSME lending landscape.
Founded by Arjun Muralidharan and Sathishkumar Vijayan, GrowXCD aims to bridge the critical credit gap for MSMEs and low-income households by developing robust credit infrastructure. The company’s innovative approach focuses on enabling institutional capital to flow seamlessly into retail assets secured by mortgages, addressing a crucial need in the financial sector.
“The fresh capital will be instrumental in enhancing our portfolio and exploring untapped markets across South India,” said Arjun Muralidharan, Co-founder of GrowXCD Finance. “Our mission is to create a sustainable credit ecosystem that empowers MSMEs and households, contributing to the region’s economic growth.”
The NBFC currently operates through its network of branches in Tamil Nadu, offering two primary products: GrowShubam, targeted at households, and GrowVyapaar, designed specifically for MSMEs. This dual-product strategy allows GrowXCD to address diverse credit needs while maintaining a focused approach to financial inclusion.
The funding comes at a crucial time for India’s NBFC sector, which is witnessing increased activity in MSME lending. Recent months have seen several NBFCs securing significant funding, including Gurugram-based Bizloan’s INR 35 crore Series A round and Bengaluru-based Avanti Finance’s $14.2 million Series B extension round.
For Tamil Nadu’s startup ecosystem, GrowXCD’s success represents a significant milestone in the state’s growing fintech sector. The company’s ability to attract substantial funding from prominent investors like Lok Capital and UC Impower underscores the region’s potential to nurture innovative financial solutions that address critical market gaps.
“This investment reflects our confidence in GrowXCD’s vision and execution capability,” stated a spokesperson from UC Impower, the equity fund of Unitus Capital. “Their approach to combining technology with deep understanding of MSME needs positions them well for sustainable growth in the sector.”
The company’s growth trajectory has been remarkable, with this funding round following closely on the heels of its INR 50 crore Series A round in November 2023, which was led by Lok Capital. This rapid succession of funding rounds demonstrates the strong market opportunity in MSME lending and investors’ confidence in GrowXCD’s business model.
This latest development not only strengthens GrowXCD’s market position but also highlights Tamil Nadu’s emerging role as a hub for innovative financial solutions. As the company expands its operations and explores new markets in South India, it is expected to play a crucial role in advancing financial inclusion and supporting the growth of small businesses in the region.
