Capital India to invest $25 million in Credenc for education Lone

Latest Update- 30/12/2022

Capital India has expanded its portfolio by investing $25 million in Credenc, a fin-tech platform for education loans. This investment is a mix of debt and equity. The goal is to realize Capital India's objective of providing Indian consumers with digital financial services and products.

Only 5% of the $50 billion or 3.5+ lakh crore paid on college fees yearly in India is financed by organized lenders. Credenc will help Capital India Finance Limited (CIFL) change the way that the market is seen and reduce underwriting risk based on Credenc's future employability score, which will raise this percentage to at least 15% with the goal of lending $3,000,000,000 by 2025. Additionally, the founders will continue to operate Credenc's operations since we don't want to disturb the organization's operations and believe they are the most knowledgeable about the industry, according to SK Narvar, Promoter, Capital India.

The Credenc employs a unique artificial intelligence (AI) model that analyzes 15 million data points to perform a rigorous evaluation process in order to forecast students' future income when they request loans. They offer financial aid based on student potential and projected income instead of the family's current financial capacity, which is often the main consideration made by traditional educational lenders.

According to Avinash Kumar, co-founder of Credenc, "Our partnership with Capital India is very strategic. It will give us both balance sheet and cost of capital advantage and help us disrupt the education lending segment by providing loans to students who were previously ignored and helping lakhs of Indian students realize their potential."

With the click of a button, Credenc offers education loans for K–12 education, higher education, as well as study abroad programs, and it will shortly introduce India's first student-focused neo bank. It is currently creating a smartphone app that will assist students and parents with credit, accommodation, employability, savings, currency trading, and investments.

We are creating a digital environment that will better serve students than ever before while putting them at the center of our company. We are empowering Indian students to be financially knowledgeable and responsible by making banking and finance simple for them, according to Credenc co-founder Mayank Batheja.

By making this investment, Credenc hopes to build a book worth 3,000 crores by the year 2025. It is an innovation education loans company with a Delhi basis that Avinash Kumar and Mayank Batheja launched in 2017. It serves as the digital finance desk for more than 1,000 colleges in 17 Indian cities.

Last Updated- 31/7/2021

This investment can be seen as a positive inflow of money into the education sector. As stated in the article, Indians spend billions of dollars on college fees alone. That’s a huge amount. But the problem is that only a certain sector of the Indian population enjoys the benefits of higher education. Private schools in India are expensive and not everyone can afford them. And we all know the state of government schools and colleges in India. Hence many students, and dare I say, bright students, end up dropping out of school because of their socio-economic background. 

This is where educational loans come in. Organizations like Credence provide many passionate and bright students, who wouldn’t have been able to afford higher studies, a chance to make their career. These education loans provide a huge relief to many students. Hence I see this investment as a huge positive and one that will benefit the whole education sector of India and hopefully helps thousands of students. We need more big firms like Capital India to invest in the education sector. Another big positive aspect of this investment is that since Credence is a homegrown start-up, an investment like this gives a huge push to the local start-up scene. It also gives a huge boost to many entrepreneurs and makes them see hope.