Chennai-headquartered non-banking financial company (NBFC) GrowXCD Finance, which focuses on providing credit to small and underserved businesses, has secured Rs 200 crore in a fresh equity funding round. The investment was led by Swiss impact investment firm Blue Earth Capital and global investor Prosus Ventures, marking a significant step in strengthening the company’s financial position and growth trajectory.
Blue Earth Capital contributed Rs 105 crore, while Prosus Ventures infused Rs 70 crore. Existing backer Lok Capital added Rs 21 crore, taking its total investment in GrowXCD to about Rs 93 crore, which now makes it the largest single shareholder in the company. Additionally, UC Impower invested Rs 4 crore to complete the round.
Founder and Managing Director Arjun Muralidharan confirmed the development and said the fresh infusion of capital would support the company’s expansion and technology initiatives. “This capital will be good for the next 12–18 months of business,” Muralidharan noted, adding that the firm’s net worth has now risen to Rs 308 crore.
Strengthening the Credit Ecosystem for MSMEs
Founded in 2022, GrowXCD was established with the goal of addressing the credit gap faced by India’s micro, small, and marginal enterprises (MSMEs), as well as salaried workers in underpenetrated markets. The company primarily operates across tier-II and tier-III towns in southern India, offering loans to businesses and individuals who often find it difficult to access formal credit from traditional banks.
Currently, GrowXCD has a footprint of 67 branches across Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, and Puducherry, with plans to expand further using the newly raised funds. Its assets under management (AUM) stand at Rs 300 crore, and the company is targeting an increase to Rs 500 crore by March 2026.
Focus Areas for the New Capital
According to the company, the new funding will be deployed across three primary areas:
- Portfolio Growth – GrowXCD plans to expand its lending book by deepening its reach among MSMEs and salaried borrowers. With many small enterprises underserved by traditional financial institutions, the company aims to fill this gap with customized loan offerings.
- Branch Expansion – The NBFC intends to increase its physical presence in semi-urban and rural regions across southern India, ensuring greater accessibility for small businesses in need of credit.
- Technology Backbone – The company is also prioritizing investments in digital infrastructure, focusing on advanced underwriting systems, credit monitoring, and digital customer interfaces to drive efficiency and reduce risks.
Muralidharan emphasized that technology will play a crucial role in ensuring robust credit assessments while enabling faster loan disbursements.
Investor Confidence in Inclusive Finance
The participation of reputed global investors such as Blue Earth Capital and Prosus Ventures highlights the growing attractiveness of India’s financial inclusion space. Small businesses contribute significantly to India’s GDP and employment but continue to face challenges in accessing affordable credit.
“Investors are increasingly looking at companies that can address real gaps in the financial ecosystem, particularly those targeting MSMEs in non-metro regions,” an industry observer noted. “GrowXCD has been able to demonstrate early traction and strong execution in a very short time since its inception.”
Lok Capital’s continued backing further underscores investor faith in the NBFC’s business model. Having been with GrowXCD since its early days, Lok Capital’s cumulative investment of nearly Rs 93 crore gives it the largest shareholder position in the company.
The Road Ahead
India’s MSME sector, comprising more than 60 million enterprises, continues to be one of the most dynamic yet credit-starved segments of the economy. Despite contributing nearly 30% to GDP and employing over 110 million people, access to structured financing remains limited.
GrowXCD seeks to bridge this gap by offering loans tailored for small businesses and individuals in emerging geographies. The company’s target to grow its AUM to Rs 500 crore in the next 18 months reflects the growth potential in this segment.
Industry analysts believe that with its sharpened focus on MSMEs and salaried segments, combined with the credibility of global investors, GrowXCD is well positioned to strengthen its footprint in financial inclusion.
“The current round not only boosts our balance sheet strength but also enhances our ability to serve a much larger pool of borrowers,” said Muralidharan. “Our goal remains the same: to empower small businesses and individuals by giving them reliable access to credit.”
As the funding round closes, GrowXCD’s next phase will be closely watched, especially as it balances growth with prudent credit practices. If it executes well, the company could emerge as a leading NBFC in the southern region’s small business lending space.
