Venture capital firm A91 Partners has invested about $20 million in small-business lender Aye Finance through a secondary sale of shares, acquiring the stake of Accion, two people aware of the matter said.
A91 and Aye Finance separately confirmed the investment to Mint, but did not comment on the deal size.
Started by Sanjay Sharma in 2014, Aye Finance typically infuses ₹1-2 lakh into businesses with an annual turnover of ₹10-30 lakh. It underwrites the risks in these loans with a unique cluster-based model, wherein it evaluates all the people in a particular field, say, automobile workers or textile workers, and correlates behavioural tendencies.
So far, Aye has raised nearly $70 million in primary capital from investors such as SAIF Partners, Falcon Edge Capital, Accion and Capital G. It is preparing for another equity fundraise and is scouting for a banker to run the process, said the people cited above.
Read more at LiveMint.