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Bengaluru-based Vridhi Home Finance, a tech-enabled housing service provider, has successfully secured Rs 150 crore in a Series A funding round led by Elevation Capital. This funding injection will be instrumental in their expansion into North Karnataka and Andhra Pradesh, enhancing their technological infrastructure, expanding their workforce, and establishing a liability franchise.
Having obtained their non-banking financial company – housing finance company (NBFC-HFC) license earlier this year, Vridhi has already opened twenty branches across Karnataka and Andhra Pradesh. Their primary goal is to provide accessible housing solutions to an underserved market.
India's housing finance sector remains relatively underpenetrated, with significant room for growth, given that assets under management (AUM) for housing loans are valued at $300 billion. Vridhi aims to democratize access to credit, particularly for the semi-urban and rural areas of India, which historically have had limited exposure to formal credit services.
Mridul Arora, a partner at Elevation Capital, emphasized the underpenetrated nature of India's mortgage market, presenting significant growth potential. Vridhi is strategically building its product line-up with a robust tech infrastructure and partnerships with leading providers of loan management software and digital onboarding systems, ensuring a scalable, paperless, and reliable operational process.
The company's mission is to cater to the affordable housing segment, focusing on consumers in small towns and district headquarters. They aim to offer loans to first-time homebuyers, funding up to 50% of the property's value. Vridhi plans to create a network of 40 to 50 branches, invest in a robust technology layer to power their operations, and establish a team of 400 to 500 employees for customer acquisition, underwriting, and documentation.
With the aid of technology and digital solutions, Vridhi is streamlining the onboarding process, aiming for loan disbursals within three to four hours, a significant improvement compared to the traditional banking process. Home loans are typically disbursed in tranches as construction progresses, often taking days. Vridhi's goal is to expedite and smoothen these processes.
In a landscape where fintech companies dominate unsecured lending, Vridhi's entry into the housing finance market has attracted support from major investors like Elevation Capital. With the backing of Elevation and similar ventures, the home loan market in India could experience significant disruption, following the trend of tech-enabled start-ups in sectors like gold loans and digital home loans.
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