Startup Deep Dive : Indifi — the sector-focused SME lender that grew 22% but slid to a loss

In FY25 Indifi’s parent company grew operating revenue 22% to ₹360 crore (about $37.5 million), and in the very same year it slid to a net loss of ₹45 crore. The lender had been profitable for two years running before that; the reversal was not a collapse in the business but the price of two decisions taken together — a switch in accounting standards and a hard clean-up of its loan book.

Indifi is not a household fintech name like PhonePe or CRED. It sits one layer behind them, lending small sums to restaurants, travel agents, e-commerce sellers and shopkeepers who banks find too small and too opaque to underwrite. Its own numbers tell a blunter story than any pitch deck: revenue that has climbed from ₹96 crore in FY22 to ₹360 crore in FY25, an NBFC arm that deliberately shrank its assets to fix credit quality, and a founding bet — that you underwrite a business better when you understand its trade — that is still being tested a decade in.

Quick facts

What Indifi does

Indifi is a digital lending platform for micro, small and medium enterprises. It underwrites and arranges working-capital loans — typically in the ₹5 lakh to ₹50 lakh range at launch — for business owners who rarely have the audited books or collateral a bank wants. It does this two ways at once: as a marketplace that routes a borrower to one of its 80-plus partner lenders, and as a lender itself through its RBI-registered NBFC, Indifi Capital. As of March 2026 the platform reported having disbursed more than 150,000 loans across over 400 cities.

The founding insight

Alok Mittal had spent close to a decade as the India head of venture firm Canaan Partners, and before that co-founded JobsAhead.com, a recruitment site acquired by Monster. In 2015 he went back to building, and the problem he picked was old and enormous: India’s small businesses could not get formal credit because lenders could not cheaply assess them. Mittal’s insight was that you do not solve that with a single generic loan product. You solve it segment by segment.

A restaurant’s cash flows, a travel agent’s booking cycles and an e-commerce seller’s marketplace payouts each look different, and each leaves a different data trail. Indifi’s bet was that if you specialise — building underwriting models and data pipes for one trade at a time — you can lend faster, cheaper and with less risk than a bank that treats every small borrower the same. At launch the company said its approach could cut credit-operations cost 50–60% and get money out within about four days of application. It started in three verticals: travel, transportation and retail. Mittal built the company with Siddharth Mahanot, who came from Indiabulls Housing Finance, Edelweiss, Citibank and ICICI Bank, and Sundeep Sahi, a product leader who had worked at Microsoft and the Bharti–SoftBank venture BSB.

The struggle years

A lender that specialises in restaurants, travel and hospitality was, by design, sitting on exactly the sectors that the pandemic shut down. When COVID-19 stopped travel and closed dining rooms in 2020 and 2021, the borrowers at the centre of Indifi’s model lost their revenue overnight, and a working-capital lender’s book is only as healthy as its borrowers’ cash flows. The strain showed in the accounts: in FY22 the company posted a net loss of ₹32.8 crore on operating revenue of just ₹96 crore.

The second hard stretch came much later and is still working through the numbers. Through FY25, wider credit stress in unsecured lending forced Indifi to take heavier provisions against bad loans, and it moved its accounting from Indian GAAP to Ind AS at the same time. The combination turned two profitable years into a ₹45 crore consolidated net loss for FY25. The NBFC arm, Indifi Capital, felt it directly: its loss widened to ₹8 crore in the first quarter of FY26, from ₹1.4 crore a year earlier, and its gross non-performing assets rose to 4.6% as of June 2025 from 3.7% a year before. Neither episode was a near-death in the funding sense, but both were reminders that a lender does not control its own fate — its borrowers’ trades do.

The turning point

The clearest inflection was FY23. Coming out of the pandemic, Indifi did not merely recover — it doubled. Operating revenue rose about 2.06 times, from ₹96 crore in FY22 to ₹198 crore in FY23, and the company swung from a ₹32.8 crore loss to a profit after tax of ₹5.1 crore. Its assets under management doubled to roughly ₹1,500 crore over the same year. That was the moment the sector-focused model stopped looking like a bet and started looking like a business: demand returned in exactly the travel and hospitality segments that had nearly sunk it, and the underwriting engine that had been built for those trades could scale into the rebound. FY24 carried the momentum, with operating revenue climbing to ₹317 crore and a slim profit of ₹2.7 crore, before FY25’s provisioning cycle pulled the bottom line back into the red.

The money behind it

Indifi has raised across roughly eight rounds since 2015, from a spread of impact, venture and development-finance investors. Tracxn puts total funding at about $90.8 million across eight rounds; other trackers cite higher totals that fold in debt, so treat the headline as reported rather than confirmed. The notable rounds and backers:

• Early / seed (2015): backed by Accel and Elevar Equity, with angels including Rajan Anandan and Genpact founder Pramod Bhasin (reported).
• Series C — $21.32 million (announced 2019): led by CDC Group (now British International Investment) with roughly $14.71 million, alongside Accel (~$3.41 million), Omidyar Network India and the Fair Finance Fund (~$1.53 million each), Elevar (~$0.99 million) and Flourish Ventures (round breakdown per reports).
• Series D — about $46 million (reported): continued participation from British International Investment.
• Series E — $35 million (June 2023, reported): led by ICICI Venture, with British International Investment and CX Partners.
• Venture debt — ₹40 crore (March 2026): from BlackSoil Capital, earmarked for SME-lending expansion.

Indifi has not disclosed a valuation, and trackers mask the post-money figure, so no reliable valuation number is stated here. Development-finance capital — CDC/BII, Omidyar, Flourish, Elevar — is the through-line: these are backers whose mandate is financial inclusion, which fits a lender built for the businesses banks skip.

How it makes money

Indifi earns from two distinct engines, and the common mistake is to treat it as a pure marketplace when a large part of the book now sits on its own balance sheet:

• Own-book interest income: through Indifi Capital, the RBI-registered NBFC, it lends its own money and earns the interest spread — the gap between what it charges borrowers and its cost of funds.
• Marketplace and co-lending fees: when it routes or co-lends a loan to one of its 80-plus partner lenders, it earns sourcing, service and commission income for origination, data collection, documentation, verification and collections.
• The margin squeeze: because the NBFC borrows to on-lend, its cost of funds matters. Indifi’s blended cost of funds averaged about 10% in FY25, and interest cost was ₹107 crore in FY24 — a large, fixed drag that rising rates or tighter wholesale funding can widen.
• Where losses come from: the profit sits in the spread and fees; the risk sits in credit costs. When provisioning rose in FY25, it swamped a healthy EBITDA of ₹107 crore and produced a bottom-line loss.

The numbers

Consolidated figures, in ₹ crore, from filings reported by Entrackr. Note the FY24 operating-revenue figure below is the ₹317 crore reported under the earlier IGAAP presentation; in the FY25 filing the FY24 comparative was restated to about ₹294 crore under Ind AS, which is why the reported FY25 growth reads as 22%.

• FY25 total income was ₹378 crore, including about ₹18 crore of non-operating income (Entrackr).
• FY25 EBITDA was ₹107 crore, up from ₹90 crore in FY24 — operationally the business improved even as the bottom line fell.
• FY25 total expenses were ₹429 crore, up 24% from ₹346 crore in FY24, driven by higher provisioning.
• FY24 bad debt written off was ₹45 crore, roughly double the prior year (Entrackr, on FY24 filing).

Where the money comes from

Indifi’s lending is spread across the trades it specialises in, and the mix is also its main source of risk. The segment and scale picture:

• Sectors served: travel, hospitality, e-commerce, retail, restaurants and transportation — vertical books, each with its own underwriting model (company-stated).
• Reach: more than 150,000 loans disbursed across over 400 cities, working with 80-plus lending institutions (company-stated, March 2026).
• NBFC book: Indifi Capital’s AUM stood at ₹1,982 crore at the end of June 2025, down about 10% from ₹2,207.6 crore a year earlier — a deliberate shrink to improve portfolio quality, per CEO Alok Mittal.
• Credit-quality trade-off: as AUM fell, credit costs dropped to 3.5% of AUM from 5% year on year, even as gross NPAs ticked up to 4.6% (June 2025).
• The surprise: the surprise is directional — management is steering toward supply-chain and secured lending, targeting 20–25% of AUM, moving a business built on unsecured, sector-specific loans toward safer, collateral-backed credit.

The risks

• Credit quality in unsecured lending: Indifi’s core product is unsecured working capital to small businesses, where defaults rise fast when demand softens. Gross NPAs rose to 4.6% (June 2025) from 3.7%, and provisioning pushed the group to a ₹45 crore loss in FY25 — the mechanism that most directly threatens profit.
• Cost-of-funds and spread compression: the NBFC borrows to lend, at a blended cost of about 10% in FY25, with interest cost of ₹107 crore in FY24. If wholesale funding tightens or rates rise faster than it can reprice loans, the spread it lives on narrows.
• Sector concentration and demand shocks: the same specialisation that improves underwriting concentrates exposure. COVID-19’s hit to travel, hospitality and restaurants — core Indifi segments — showed how a demand shock in one trade flows straight into the loan book, and the FY22 loss of ₹32.8 crore is the proof.
• Regulatory risk on digital lending: RBI’s tightening of digital-lending and default-loss-guarantee norms affects how marketplace lenders can partner, source and share risk, and can raise compliance cost or reshape the co-lending model Indifi relies on (sector risk).

The takeaway

The transferable lesson from Indifi is about the shape of specialisation, not the size of the returns. Betting the company on a few trades made underwriting sharper and let it scale into a rebound faster than a generalist could — the FY23 doubling is the reward. But the same choice concentrated the risk, so when those trades stumbled, the loss landed squarely on the book. Specialisation is not a moat you build once; it is a position you have to keep hedging. Indifi’s own answer — pushing toward secured and supply-chain lending while deliberately shrinking a stressed book — is what that hedging looks like in practice, and whether it works is the FY26 story still being written.

Frequently asked questions

What does Indifi do?

Indifi is a digital lending platform for MSMEs. It arranges and underwrites working-capital loans for small businesses — restaurants, travel agents, e-commerce sellers, retailers and transporters — both as a marketplace routing borrowers to 80-plus partner lenders and as a lender itself through its RBI-registered NBFC, Indifi Capital.

Who founded Indifi and when?

Indifi Technologies Private Limited was incorporated on 27 May 2015 in Gurugram, Haryana. It was founded by Alok Mittal (CEO, formerly India head of Canaan Partners), Siddharth Mahanot (COO) and Sundeep Sahi (CTO).

Is Indifi profitable?

It was profitable in FY23 (PAT ₹5.1 crore) and FY24 (₹2.7 crore), but reported a consolidated net loss of ₹45 crore in FY25, driven by heavier provisioning and a switch from IGAAP to Ind AS accounting. Operating EBITDA still rose to ₹107 crore in FY25, and management has said the company returned to profitability from Q2 FY26.

How much funding has Indifi raised and who are its investors?

Tracxn reports about $90.8 million across roughly eight rounds; other trackers cite higher totals that include debt. Backers include Accel, Elevar Equity, Omidyar Network India, Flourish Ventures, British International Investment (formerly CDC Group), ICICI Venture and CX Partners. The last equity round was a reported $35 million Series E in June 2023.

Is Indifi listed on the stock market?

No. Indifi is a privately held company and has not disclosed a public valuation. Its most recent capital was ₹40 crore of venture debt from BlackSoil Capital in March 2026.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• Entrackr — “Indifi’s revenue grows 22% in FY25; reports Rs 107 Cr EBITDA” (FY25 financials), 2026
• Entrackr — “Indifi scale goes past Rs 300 Cr in FY24; stays profitable” (FY24 and FY23 financials), 2024
• Entrackr — “Indifi nears Rs 200 Cr revenue in FY23, turns profitable” (FY22 and FY23 figures), August 2023
• Inc42 — “Indifi’s NBFC Arm’s Loss Zooms To INR 8 Cr In Q1 FY26” (Indifi Capital AUM, GNPA, credit cost), 2025
• Inc42 — Indifi company and financials profile (standalone vs consolidated note), 2026
• Business Standard — “Indifi Tech’s assets under management double to Rs 1,500 crore in FY23,” May 2023
• Business Standard — “BlackSoil extends ₹40 crore debt funding to Indifi for SME expansion” (disbursement and partner counts), March 2026
• TechCrunch / Entrackr / GPCA — Indifi $21.32 million Series C led by CDC Group (round breakdown), 2019
• Financial IT — “Indifi Technologies Raises $35 Mn in Series E Round” (ICICI Venture lead), June 2023
• MediaNama — “Canaan Partners former India chief Alok Mittal floats new venture” (founding insight, model, segments), October 2015
• Inc42 — “Alok Mittal launches Indifi” and YourStory profile (founder backgrounds), 2015–2017
• Tracxn — Indifi company and legal-entity profiles (total funding, investor list, CIN, headcount), 2026
• Ministry of Corporate Affairs / ZaubaCorp records — Indifi Technologies Private Limited, CIN U74140HR2015PTC055588, incorporated 27 May 2015

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