Micro MSME fintech ARTH raises $2.5 mn from DEG, MIT Alumni and Impact Angels

Micro MSME Fintech ARTH has announced it has secured $2.5 million in funding led by most experienced institutions DEG – Deutsche Entwicklungs- und Investitionsgesellschaft / subsidiary of KfW, MIT Alumni and top notch impact-driven US & Canadian angel investors.

This takes the total funding raised by ARTH to $3.5 million with the initial personal investment made by the founder, friends and family.

The fresh round of funding will be used to expand the suite of financial services being offered to ultimately be a single point platform for Micro MSMEs. The funds will also be used for strengthening the technology capabilities and building robust risk management systems to meet the scale requirements, it said in a press statement.

ARTH started by woman founder Shweta Aprameya in 2018, is a regulated MSME Fintech targeting a multi-billion- dollar credit gap, in India’s micro and nano businesses. ARTH’s primary focus is to increase access of affordable formal financial services to these businesses to create a transformational impact on their lives with focus on gender financing.

Since its inception, ARTH has been able to stay revenue and bottom-line focused bootstrapped Fintech Start Up. The company currently provides well-priced working capital, embedded insurance and income generating payment services through its financial services platform especially designed for micro MSMEs. The fintech has already facilitated 3,50,000 credit & insurance across India ; many of whom are new to formal credit.

Shweta Aprameya, Founder ARTH, said, “We are one of the first movers in the market who have been able to build an integrated credit and payment solution for the micro-MSME through last mile collaborative partnership model. The model also reduces the information gap that exists for underwriting the segment and hence improve access to formal credit. For financial institutions like ours, the model allows us to go deeper and faster in Indian markets with well evolved data and decision-making tools.”

The company plans to scale to 1 million nano and micro business owners through its phydigital model offering both credit & payments services with the aim to become a dominant revenue generating start up for the MSME segment in India.

“DEG is happy to fund the growth of ARTH. Access to affordable credit for micro businesses is a huge gap in India and the right product can bring large scale impact in the sector. Thus a contribution is also made to the UN-Sustainable Development Goals (SDG), for example a reduction of poverty and creation of decent jobs,” said Petra Kotte, Head of DEG’s division Banking & German Business.