Svakarma Finance

Svakarma Finance operates as an impact-driven non-banking financial company (NBFC), dedicated to addressing the significant credit gap—estimated at ₹7.4 trillion—faced by micro, small and medium enterprises (MSMEs) underserved by traditional banking institutions in India. The company’s mission is to empower entrepreneurs by providing accessible, customized financial solutions and knowledge support, thereby fostering inclusive growth and positive socio-economic transformation across its core markets.

Core Products and Services

• Business Loans: Working capital and capex financing with ticket sizes typically rangingf from ₹1 to ₹25 lakhs.

• Asset Purchase Loans: Support for acquiring business-critical assets.

• Specialized Loans for Women Entrepreneurs: Targeted financing to promote gender inclusion.

• Rooftop Solar and WASH Sector Financing: Loans for sustainable and social impact initiatives.

• Knowledge Support: Capacity-building workshops and advisory services to help clients manage and grow their businesses.

key milestones

• RBI license received: Commenced operations as a regulated NBFC after receiving the Certificate of Registration in 2018.

• Branch expansion: Rapidly scaled to 91 branches across 70+ cities, with a strong presence in Maharashtra, Gujarat and Tamil Nadu.

• Portfolio growth: Built a loan portfolio exceeding ₹50 billion and served over 72,000 active micro-enterprise customers.

• Strategic partnerships: Secured investment and partnership with DBS Bank, which acquired a 9.9% stake in 2022.

• Funding milestones: Raised USD 10.4 million in a fresh funding round led by Encourage Capital.

• Impact initiatives: Launched targeted lending programs for women entrepreneurs and high-impact clusters and provided grants to support customers during COVID-19.

• Technology integration: Implemented digital platforms to enhance customer experience and operational efficiency.

Business model and revenue streams

• Interest Income: Main revenue source from interest on business loans and term loans (including rooftop solar financing).

• Processing and Service Fees: Additional income from loan origination and documentation.

• Direct Selling Agent (DSA) Channel: Recently introduced phased sourcing of loans through DSAs to expand reach.

• B2B Focus: Nearly all customers are micro-enterprises and small businesses—minimal exposure to large corporates or B2C.

Top Clients & Partnerships

• DBS Bank: Holds a strategic stake in Svakarma, supporting its growth and providing access to broader financial networks.

• Encourage Capital: A key investor, aligned with Svakarma’s impact-focused mission.

• Other Lenders and Debt Partners: Multiple financial institutions provide debt lines to support portfolio growth.

• Knowledge Partners: Collaborations with organizations offering capacity-building and advisory services to clients.

Future Outlook & Strategic Priorities

• Market Expansion: Continued branch rollout and deeper penetration in existing and new geographies, targeting the vast credit gap in India’s MSME sector.

• New Product Development: Introduction of innovative financial products, including green finance and digital lending solutions.

• M&A Pipeline: Potential for strategic acquisitions to enhance technology, distribution, and service capabilities.