KreditBee offers personal and small business loans through its app.

BENGALURU: Digital lending platform KreditBee, which offers personal and small business loans through its app, has raised $280 million in a funding round that values the company at $1.5 billion, joining the ranks of unicorns, startups valued at $1 billion or more. KreditBee becomes the second unicorn this year after Juspay. The round was jointly led by Hornbill Capital and Motilal Oswal, with participation from investors including Advent International, Premji Invest, MUFG and others. Chief executive Madhusudan Ekambaram said the capital will primarily be used to strengthen the company’s lending book and balance sheet, rather than fund new product investments. “The fundamental reason for raising capital is for the debt-to-equity leverage,” he told TOI. KreditBee typically operates at a debt-to-equity ratio of about 3:1. “With this infusion, we are very well set for at least doubling our AUM… it gives us a good leeway for two-and-a-half to three years.” The company recently reverse-flipped its parent entity from Singapore to India. The company is preparing for an initial public offering and is currently in the process of merging its technology and NBFC entities, a step it plans to complete before filing. “We are in a merger process… maybe another couple of months to get the merged entity. The merged entity is what we are planning to file in the IPO,” Ekambaram added. He added that the listing could take place “either end of this year or early next year,” though final timing will depend on board decisions and market conditions. A larger equity base is also expected to lower the company’s borrowing costs by improving lender confidence and credit ratings. “A lot of equity capital in the company gives good confidence to debt participants… the cost of funds at which we raise debt should ideally come down,” he said. KreditBee reported revenue of about Rs 2,700 crore and profit after tax of Rs 470 crore in the financial year ended March 2025. Ekambaram said revenue has grown more than 25% and profit more than 50% in the latest financial year, though final audited numbers are yet to be disclosed. As the company prepares for public markets, he said return on equity will be a key metric for investors. “ROE will be the key metric… that’s the fundamental of any company,” he said. KreditBee’s business is largely driven by unsecured lending, with average loan tenures of about 12-13 months. Ekambaram said managing risk through cycles remains central to the model, especially amid macro uncertainties such as inflation pressures linked to global conflicts. “In lending, the only thing that matters is risk management,” he said. “Sometimes it is prudent to control your growth… we will use all those experiences to ensure that the portfolio performance remains intact.” End of Article

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