Bengaluru-based fintech company, Crediwatch that creates ‘trust scores’ of small and medium businesses using artificial intelligence (AI) and machine learning (ML) tools, said Tuesday, it has raised USD 3.2 million in Series A round led by California-based early-stage firm ARTIS Labs, with participation from Abstract Ventures.
Till now, the company has raised a total of USD 5 million from various angel investors including, Modern India Ltd., Mekin Maheshwari (Flipkart’s former chief people officer), and Pithambar Gona (former managing director of Blackstone Pvt. Equity Asia), among others.
Most the funding, the company said will be used towards research and development, further commercialization of the product to gain more traction, and increase the team size from the current 41 to over 60 members.
“We have something called ‘dynamic trust score’ on SMEs. We will also use the money to grow that product and fine tune it further to improve the predictive model,” Meghna Suryakumar, co-founder and ceo, Crediwatch, told KrASIA.
Suryakumar claimed, the company has digital ledger of 18 million businesses across India, and said it works with over 20 financial institutions.
The three-year-old company works with banks, public service undertakings (PSUs), and non-banking financial services (NBFCs), to provide trust scores of small and medium businesses. Suryakumar said, the company creates trust score of SMEs that helps these financial institutions in deciding whether to lend them money or not.
The trust score, the company claims, is generated using AI and ML, that takes cognizance of a company’s 2500-plus data points. According to Suryakumar, when she started the company, they were only looking at two to three data points.
“We are able to tell our clients the dynamic risk inside a business, whether this company is likely to be financially stable, and if yes, how long it will take to get there. We can predict all that,” she said.
The company, in a statement said, less than 15% of the over 50 million Indian small businesses have access to formal credit, and lenders have written off more than USD 100 billion due to bad debts in the last three years. It said the debt financing gap of the SME is over USD 1 trillion.