Fintech startup Rupeek gives out $1 billion in gold-backed loans

Rupeek Fintech Pvt, a start-up that lends against gold as collateral, raised $34 million to accelerate its efforts to monetise India’s $1.5 trillion private stash of the precious metal.
 

The Bangalore-based firm, whose technology links nearly a dozen banks to individual borrowers, received backing from investors including Lightbox, GGV Capital and Bertelsmann, taking its valuation to $634 million with $134 million raised so far. Rupeek’s annual loan disbursement rate was $1 billion in December, a first among India’s asset-backed lending startups, according to a statement Tuesday.
 

“Rupeek’s growth trajectory changed dramatically and loan volumes doubled in the second half of 2021,” Sumit Maniyar, founder and chief executive officer, said in an interview. “We are the first fintech to hit $1 billion milestone.”  
 

Consumers in India -- where gold is considered both a status symbol and a popular investment -- hold about $1.5 trillion of the precious metal, mostly in jewelry, according to the World Gold Council. But gold-backed loans account for only about $150 billion, mostly from street-corner money lenders and pawnbrokers, with traditional banks making up just 35%, according to CLSA estimates.
 

The Accel and Sequoia Capital-backed start-up uses technology to assess gold offered as collateral and crunches data to issue loans that monthly interest rates that 0.49% and can reach as high as 1.5%. To help borrowers escape a cultural stigma associated with pledging gold, agents riding motorcycles perform appraisals within customers’ homes, while teams back in offices complete background checks and process the loans electronically.