Mumbai based digital lender NeoGrowth has raised Rs 85 crore in a fresh round that blends equity and debt. Dutch development finance institution FMO led the deal, with existing backer LeapFrog Investments also taking part, the company said in a press release on October 9, 2026.
The cheque gives the MSME focused non banking finance company more room to grow its loan book. NeoGrowth says the money will help it build a book of nearly Rs 3,000 crore before it needs another equity infusion.
The funding and its investors
The Rs 85 crore comes as a mix of equity and debt rather than a single equity round. FMO, the Dutch development bank, has backed NeoGrowth before and this time led the transaction. LeapFrog Investments, an existing shareholder, came in alongside it.
NeoGrowth last raised equity in December 2022, when it closed a Rs 300 crore (USD 36 million) Series D round led by FMO, which underwrote more than half of that raise. The cap table also counts Omidyar Network, Lightrock, Khosla Impact, Quona Capital’s Accion Frontier Inclusion Fund and 360 ONE Asset.
What NeoGrowth does
NeoGrowth lends to micro, small and medium enterprises that banks often find hard to underwrite. A kirana owner may post steady daily sales but own no property to pledge. NeoGrowth prices that risk using transaction history instead of collateral alone.
The company reads digital payment data, point of sale transactions and cash flows to judge a borrower’s creditworthiness. Its repayment plans run daily, weekly, fortnightly or monthly, a rhythm built to match the cash cycle of a small shop. It offers both collateral free and collateral based loans, with collateral free tickets between Rs 5 lakh and Rs 75 lakh under products such as NeoCash, NeoCash Insta and NeoCash Express.
How the money will be used
The company says the proceeds will scale its digital lending, widen its reach across India and expand credit access for small businesses. The stated target is a loan book near Rs 3,000 crore before the next equity raise. Branch expansion and sharper underwriting, supported by the lender’s own artificial intelligence tools, form part of the plan.
Read more: consumer brand DailyObjects raised Rs 332 crore in a Series C round, one of the larger funding rounds newzshort tracked this week.
Financials and reach
NeoGrowth manages assets under management of nearly Rs 2,000 crore. It says it has engaged with more than 4 lakh businesses and has disbursed over Rs 16,000 crore in loans since it began. It operates in more than 25 cities, spans 75 to 80 business segments and has funded more than one lakh businesses. During FY26 it added 17 branches, taking its branch network to 46 locations.
The lender has also leaned on debt markets, raising close to Rs 2,000 crore from 18 lenders between April 2025 and July 2026. Arun Nayyar, managing director and chief executive, said the fresh capital will help the NBFC reach more MSMEs with timely and accessible formal credit, enabling more small business owners to pursue their growth plans through its lending products.
Founders and background
NeoGrowth was founded in 2012 by brothers Dhruv Khaitan and Piyush Khaitan. It built its model around borrowers who were largely shut out of formal credit. That bet now sits inside a crowded field of digital lenders, including Indifi Capital, Techfino, Lendingkart, FlexiLoans and Aye Finance, all using technology to reach the same small business customers.
What happens next
The MSME lending space has drawn steady capital. Prayaan Capital raised Rs 110 crore in a Series A led by Peak XV Partners in February 2026. GetVantage picked up Rs 63 crore in August 2026, and Business Nextgen Finance raised Rs 215 crore. FlexiLoans and Techfino added Rs 375 crore and Rs 65 crore respectively. Investors are rewarding lenders that can show clean books, and the sector is now judged as much on asset quality as on the size of the loan book. NeoGrowth’s push to Rs 3,000 crore, backed by FMO and LeapFrog, puts it squarely in that race.
