Exclusive: Varthana Bags INR 75 Cr Debt Funding From OfBusiness, Oxyzo

Education-focussed non-banking finance company (NBFC) Varthana has raised INR 75 Cr (about $8.7 Mn) in a debt funding round co-led by B2B ecommerce startup OfBusiness and its financial services arm Oxyzo.

Varthana’s board passed a resolution in January to issue 75,000 non-convertible debentures (NCDs) with a face value of INR 10,000 each to raise the sum, its regulatory filings sourced from the Registrar of Companies showed.

IPO-bound OfBusiness and Oxyzo each invested INR 27.50 Cr in the Bengaluru-based NBFC, while Ambium Finserve and IKF Finance infused the remaining INR 20 Cr.

Varthana plans to use the fresh capital to grow its loan book by providing financing solutions for low-budget private schools and students seeking to pursue higher education in India, a company spokesperson told Inc42.

Commenting on the growth plans, the spokesperson said that Varthana will continue to focus on strengthening and expanding its existing offerings in the school and student loan segments.

Varthana’s loan book grew 48% year-on-year (YoY) to INR 1,896 Cr in the fiscal year 2024-25 (FY25) from INR 1,280 Cr in FY24 and INR 900 Cr in FY23. The NBFC aims to grow its loan book by 50% by March 2026 from current levels, solidifying its presence in its core, school and student loan segments, the spokesperson added.

Streamlining Credit For Schools & Students

Founded in 2013 by Brajesh Mishra and Steve Hardgrave, Varthana offers low-cost, collateral-free loans, with customised EMI options, to private schools and students.

Under its student loan offering, it provides loans of up to INR 5 Lakh for degree and post-graduate (PG) courses, two-year pre-university college degrees, certification courses and skill enhancement courses.

With a presence in 40 cities across 15 states, Varthana claims to have financed over 11,500 private schools and extended over 75,000 loans since its inception.

It last Microfinance Fund in December 2024. Overall, Varthana has raised over $130 Mn in funding to date and counts the likes of ChrysCapital and Accion among its backers.

In the student loan category, it competes against, Leap Finance and Eduvanz. In the educational infrastructure loan space, it locks horns with players such as Auxilo, Ugro Capital, EnableCap, and IFSC, among others.

Varthana reported a net profit of INR 30 Cr on an operating revenue of INR 209 Cr in FY24.

India’s Lending Tech Boom

The latest fundraise by Varthana comes at a time when digital lending is booming in India, fuelled by rising disposable income and higher internet penetration.

As a result, fintech startups, especially digital lending platforms with an NBFC licence, are seeing increased investor interest. Mumbai-based Minitifi recently raised $180 Mn (about INR 1,500 Cr) in its Series E funding round led by TVG and Prosus.

Prior to that, Flexiloans from Accion, Fundamentum, among others.

Valued at $402 Bn in 2024, India’s burgeoning lending tech space is projected to become a $1.3 Tn+ opportunity by 2030.

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