Amazon Smbhav Venture Fund has lately invested $20 million equity in fintech startup Axio and it is a step forward in the evolving landscape of digital lending in India. The step also signals a strong endorsement of the potential of Axio as well as a broader shift toward empowering underserved segments including micro, small and medium enterprises (MSMEs). Digital lending is gaining ground in the country and the sector is basically focusing on providing accessible and responsible credit solutions to those who have traditionally been left out of the formal financial system.
Axio is a renamed brand. It was initially popular as Capital Float. The fresh fund is learned to be used in scaling the lending operations and simultaneously expand offerings in checkout finance. The company is also to introduce more comprehensive credit products which would be tailored to the needs of the customers throughout their financial journeys.
Axio has a solid foundation and a clear vision for growth. It is to leave a significant impact on the digital lending sector. It has reached around 10 million credit customers and boasts a billion-dollar annualized disbursal rate.
The new investment is a reflection of the increasing momentum behind equity deals in the digital lending sector focused on MSMEs. A couple of similar key players such as Flexiloans and Indifi Technologies are also attracting substantial investments. Flexiloans is in discussions to raise $35 million. Indifi Technologies has already secured a similar amount in 2023.
The success of Axio in securing fund highlights its strong market position and growth potential as well. Axio had earlier raised $137 million in equity and $671 million in debt.
The company achieved a post-money valuation of $201 million in 2021 after raising $50 million in equity funding led by Lightrock India. Its impressive roster of investors includes Peak XV, Elevation Capital and Ribbit Capital.
