ZestMoney to disburse credit worth $400 mn, partners with Northern Arc

ZestMoney, an artificial intelligence-driven EMI financing platform, said it has formed a strategic financial partnership with Northern Arc Capital, a non-banking finance company, that aims to address the growing demand for EMI financing in India. Under this long term partnership, Northern Arc Capital has deployed $14 million till date and plans to fund various products offered by ZestMoney in a phased manner. ZestMoney aims to disburse $400 million in the next year to improve access to credit in India where credit card penetration remains very low.

“We are striving to develop a deeper and holistic ecosystem for expanding our palette of offerings and access to affordable EMI solutions. We have built some great NBFC partnerships over the last three years and are excited to work with the Northern Arc that shares our vision for financial inclusion in India,” said Lizzie Chapman, CEO, ZestMoney.

Bengaluru-based ZestMoney said its technology platform provides easy access to consumer loans to millions of Indian households, which currently have no access to credit cards or any other formal financing options due to insufficient credit history. Its unique platform uses mobile technology, digital banking, and data science to solve the affordability problem.

Northern Arc Capital said it has been instrumental in enabling financial inclusion in India by providing financial institutions that target lending to middle-income households and small businesses with critical access to debt capital markets. Similarly, Northern Arc’s partnership with ZestMoney will also span a broad array of both domestic and international structured funding markets in addition to providing direct funding on the origination platform.

“Building on our decade-long experience of underwriting granular retail portfolios, Northern Arc has adopted a digital approach toward direct lending,” said Kshama Fernandes, MD and CEO of Northern Arc Capital. “Nimbus, our agile platform, seamlessly integrates with technology platforms like ZestMoney enabling efficiencies of reach at scale. The partnership with ZestMoney has been particularly exciting as it reaches out to a large universe of unbanked and underbanked borrowers across the country,” she added.

ZestMoney recently announced a strategic partnership worth $100 million with Credit Saison, a Japanese financial services company affiliated with Mizuho Financial Group and the third-largest credit card issuer with over 20 million cardholders in Japan. This funding will be directly deployed into ZestMoney’s core loan origination activity.