Aye Finance's early investor Accion sells its stake to A91 Partners

Aye Finance has announced that Accion, a global non-profit and one of its earliest investors, has sold its stake in Aye to A91 Partners, an Indian investment firm that raised its first fund in 2019 to help finance and build the next generation of enduring Indian companies.

Aye Finance was founded in 2014 to address the credit challenges of the unbanked micro enterprises of India and to power their growth into new age India. Right since inception Aye has found support from marquee investors who have supported it in its mission of transforming micro enterprise lending in India. Accion first participated in Aye’s seed equity round in early 2015 along with SAIF Partners and seeing the tremendous potential in Aye’s innovative credit assessment models, provided additional capital in the two subsequent equity rounds as well. In the early years Accion also partnered with Aye on various advisory projects across risk and analytical verticals.

Commenting on the development Sanjay Sharma, Founder and Managing Director, Aye Finance, said, “The teams at Aye have been relentlessly working to bring this ignored sector into the folds of organized lending and we recently reached the milestone figure of two hundred thousand loans disbursed. Accion has been a supportive partner in our transition from a startup to a mid-size organization. We are grateful for their initial capital and advisory support in the last 5 years. A91 Partners are a quality investor team and our growth trajectory will get strengthened with their India focus. The deal was led by Kaushik Anand of A91, who was earlier on our board as Nominee Director of CapitalG. This investment from A91 is a clear reaffirmation of the confidence of our investors in our team and our business model.”

Kaushik Anand, Partner, A91 Partners said, “Over the last 2 years, Aye has grown from Rs. 500 cr to over Rs.1500 cr of AUM using technology as a backbone to scale the business. Under Sanjay’s leadership, the Aye Finance team has built a sustainable and profitable business while helping thousands of microenterprises with access to formal credit. We look forward to partnering with Sanjay and team in their journey to build an enduring franchise.”

Michael Schlein, President and CEO of Accion said, “Aye Finance provides much-needed financial services to India’s small and medium-sized informal businesses and the entrepreneurs who run them – a critical, but often overlooked and underserved, population. This is why Accion began supporting Aye at its earliest stages with capital and advisory services. We are proud to exit five years later knowing that Aye has reached more than two hundred thousand customers and is on a clear trajectory to continue growing and advancing financial inclusion,”

Abhishek Agrawal, Accion’s Chief Regional Officer for South Asia said, “We are pleased to have played a role in Aye’s success reaching thousands of Indian entrepreneurs through a unique MSME cluster based approach, and are confident that A91 is the right partner to support the company’s continued growth and expansion”.

Having established an innovative paradigm in micro enterprise lending in India through its “Cluster Based Credit Assessment” methodology, Aye has now developed various Artificial Intelligence / Machine Learning models to extend credit to a much larger population of micro enterprises, establish a tighter control on its asset book quality along with bringing improved efficiencies in its processes.