Freo, the innovative digital banking platform operated by Mwyn Tech, has achieved a significant milestone by securing an undisclosed amount of debt funding from the Small Industries Development Bank of India (SIDBI). This strategic investment marks SIDBI’s first foray into debt investment within the fintech domain, signaling its confidence in the sector’s potential to catalyze financial inclusion and entrepreneurship throughout India.
About Freo:
Founded in 2015 by Bala Parthasarathy, Anuj Kacker, and Kunal Varma, Freo is committed to addressing the financial needs of Indians with its ‘pay, save, borrow’ philosophy. The platform provides a comprehensive suite of financial products, encompassing credit lines, credit cards, and credit-on-UPI through Rupay, alongside innovative savings solutions.
SIDBI’s Debut in Fintech Debt Investment:
SIDBI, established in 1990, has a primary focus on promoting, financing, and fostering the growth of Micro, Small, and Medium Enterprises (MSME) in India. This debt investment in Freo marks SIDBI’s inaugural venture into supporting a fintech business, underscoring its dedication to diverse sectors, including startups, mobility, and MSMEs. The institution manages various Fund of Funds (FoF) programs on behalf of the Indian government and state governments.
The fresh infusion of funds will empower Freo to diversify into new categories and segments while expanding its reach across the nation. Anuj Kacker, Co-founder of Freo, expressed enthusiasm about the collaboration with SIDBI, emphasizing its profound impact on Freo’s journey. The partnership is anticipated to be a cornerstone for further growth and innovation.
Despite a notable 63% decline in VC funding for India’s fintech industry in 2023, totaling $3 billion compared to the record-breaking $8 billion in 2021, Freo’s partnership with SIDBI emerges as a positive catalyst for rejuvenating growth and fostering innovation in the sector. This collaboration is poised to contribute significantly to advancing financial inclusion and accessibility in the Indian financial landscape.
Conclusion:
Freo’s successful debt funding round with SIDBI not only marks a pivotal moment for the digital banking platform but also symbolizes a broader trend of traditional financial institutions recognizing the transformative potential of fintech. As Freo charts its course for expansion and innovation, this collaboration positions it as a key player in driving financial inclusivity and empowerment across diverse segments of the Indian population.
