The funds will be used to strengthen its technology, data and sales functions within the company. The report also states that the company had raised USD 750K from Prime Venture Partners earlier in April 2016.
Founded in 2015, KredX is an online discounting platform that allows business owners to raise funds for their working capital needs by selling their unpaid invoices raised on blue chip companies.
Both SMEs and investors can sell and buy on the platform respectively after registering themselves on the platform. Investors can buy the listed invoices of SMEs at a discount of 12-20%. KredX accepts investors looking to invest a minimum of Rs. 3 lakhs per deal for short term (30-90 days). Investors may be individuals, proprietors, institutional investors, banks, NBFCs, NRI investors and other financial institutions. The company does not guarantee any specific rate of returns to the investors.
In July 2016, Bank of Baroda partnered with Kredx apart from six other FinTech companies in an attempt to acquire more customers and offer new products to existing customers.
Earlier this week, Fintech companies classified under “other financial services” were permitted 100% foreign direct investment (FDI) through the automatic route, as opposed to the approval route earlier. Earlier, only non-banking finance companies (NBFCs) under 18 categories engaged in activities such as stock broking, investment advisory etc were permitted 100% FDI through the automatic route.
As such, Kredx’s proposition does not have a proper classification and regulators will have to update themselves on their business.
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