A promising financial startup named Yellow Metal secured $3 million for its Seed funding round. Along with participation from Spiral Ventures, a Japanese venture capital firm, and existing investors WaterBridge Ventures and Java Capital, the investment was spearheaded by MSA Novo, a multi-stage venture capital firm, to support the startup’s goal of revolutionizing the gold loan industry.
The fresh funds will help expand technology team operations across 25 new markets in and outside of Karnataka and also add new forms of asset-backed lending that are required for consumers in Rural India. They will further invest in strengthening their proprietary loan management system built for mobile phones. Arguably the first of its kind, which will enhance its customer experience. Currently, across 7 towns and opening 500 accounts each month.
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Speaking about the recent funding round Rahul Boggaram and Nikhil Boggaram, brothers and Co-Founders of Yellow Metal, mentioned, “Building trust in the rural markets will help us become a destination for all forms of asset-backed lending. This seed fund will help us to invest more in technology that will, in turn, help build a better customer experience and a transparent product. If the company has a strong financial position, we will also be able to negotiate favourable terms from the partnerships. We are excited about the opportunities ahead and grateful for the support of our investors and partners.”
Yellow Metal’s app makes gold loans more accessible, cost-effective, and user-friendly for Tier 2, 3 & 4 of South India. The platform ensures complete transparency in pricing, payments and collections and enables digital loan disbursements. In partnership with banks, they bring their services directly to customers’ doorsteps.
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“We are proud first partners of YellowMetal and excited to continue to partner with Nikhil and Rahul as they set out to become rural India’s most trusted financial services brand. Their customer-first thinking and deep operational expertise have helped them scale to >$1m in monthly disbursements across 7 Southern Indian towns with only $580k of seed capital. With this new $3m funding round, we are confident that they will continue to execute well and scale to 25+ towns”, said Anjali Sosale of Waterbridge Ventures, a homegrown, India-centric VC, an early backer of breakout startups like UnAcademy, Atlan, Chalo, Citymall and others.
Prior to this, Yellow Metal raised $580k, led by Waterbridge Ventures and Java Capital. The company is headquartered in Bangalore, India and currently operates in seven towns within Karnataka state, including Chintamani, Chikkaballapura, Kolar, Dodaballapura, Malur, Hoskote and Sidlaghatta.
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Yellow Metal enables these households to access cheaper credit at scale by combining existing offline network of agent with technology . We are very impressed by the scale achieved by Yellow Metal in just 1 year of operations with a limited capital outlay. The need of credit will increase as India grows and we are very confident that Yellow Metal will be able to provide a full range of asset backed credit products in the near future.”, said Prakhar Khanduja of MSA Novo.
“Solving the liquidity needs of small-town consumers in India lends itself to massive untapped market potential. We strongly believe that Yellow Metal, with its region-based, distribution-first and tech-driven business model, is perfectly poised to capture it. We look forward to connecting the Japanese financial services ecosystem and Yellow Metal”, said Sujit Kunte of Spiral Ventures.
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About Yellow Metal
Rahul and Nikhil Boggaram founded Yellow Metal in 2020, a Bangalore-based startup that offers gold loans. They provide customers with transparent pricing, no processing fees, and quick, affordable gold loan services that can be obtained in just 30 minutes at the customer’s doorstep. They can scale 25x faster than a local offline Gold Loan NBFC thanks to their customer and loan manager app, which ensures end-to-end digitization from KYC to Loan Agreements to disbursements and collections.