Invoice factoring start-up Reevoy, which allows Indian SME exporters to seek collateral-free working capital finance, has raised angel investment from 25 global investors, including PolicyBazaar co-founder Alok Bansal and Aspiring Minds co-founder Himanshu Aggarwal.
The funding will be used for building technology, hiring talent, and growing factoring operations in the UK and India. “SMEs contribute approximately 30 per cent towards India’s global trade, whereas the share of banking credit is approximately 15 per cent. Lack of credit leads to SMEs losing orders and not being able to scale their business beyond collateralized lines of credit,” said its co-founder Ankur Khetan.
Reevoy was founded by IIT Delhi alumnus Ankur Khetan, Ishan Dadhich and Mohit Agarwal last year amidst Covid-19 pandemic with the aim of addressing the working capital funding gap faced by Indian SMEs.
The UK-based startup is backed by investors, such as Alok Bansal (Co-founder of PolicyBazaar), Himanshu Aggarwal (Co-founder of Aspiring Minds), Gaurav Ajmera (ex-COO of OYO), Sorabh Agarwal (Founder of AngelBay), Saurabh Aggarwal, Naman Sharma, Rahool Sureka (Co-founders of Fitso), Aadit Prasad (Director of Castlelake, UK).
Speaking about the investment, Alok Bansal, co-founder of Policybazaar, said, “The credit problem in India is a glaring one. While the factoring penetration is around 5% globally, India’s factoring penetration isn’t even 0.5 per cent as of today. I believe Reevoy is out to tackle a problem which needs immediate attention, and the product will contribute towards the ease of doing business for SMEs involved in exports.”
In February this year, RBI Governor Shaktikanta Das had said that small businesses have emerged as the growth engine of the economy with a vast network of about 6.33 crore enterprises contributing 30 per cent of our nominal GDP and 48 per cent to exports. However, at present, the MSME credit gap is pegged at around USD 240 billion (Rs 17 lakh crore).
Talking about the utility of Reevoy, Parth Poddar, an apparel SME exporter said, “Reevoy offers quick factoring solutions for my invoices. The process is efficient and reliable. We have been able to manage our cash flow and process more orders from the time we started working with Reevoy. The founding team’s ground experience in trade finance, helps them craft better products and services as compared to the market.”