The early stage venture capital firm has reaffirmed its confidence in portfolio company Spense by participating in a USD 2.8 million seed funding round, supporting the fintech startup’s mission to modernise asset backed lending and banking infrastructure in India.
India’s fintech ecosystem continues to attract investor confidence as digital lending evolves beyond unsecured credit. In a strong endorsement of this shift, GrowthCap Ventures has announced a follow on investment in its portfolio company Spense, participating in the startup’s USD 2.8 million seed funding round led by Arkam Ventures.
The round also saw participation from Razorpay Ventures, Atrium Ventures, and several prominent fintech and technology leaders, including Kunal Shah, Founder of CRED, Madhusudhan E of KreditBee, Ravishankar of Active.ai, Suresh Rayasam Venkatasubbaih of LinkedIn, and Sayandeb Banerjee of The Math Company.
The investment highlights growing institutional confidence in technology platforms that enable banks to unlock greater value from financial assets while expanding access to secured credit.
Building the Next Generation of Credit Infrastructure
GrowthCap Ventures was the first institutional investor in Spense, leading the company’s pre seed funding round in May 2025.
Its continued participation reflects long term confidence in the founding team and the broader opportunity emerging within India’s digital lending and banking infrastructure landscape.
Spense is addressing a critical gap in the financial system by enabling banks to offer credit backed by customer owned financial assets such as fixed deposits, mutual funds, equities and invoices.
Instead of relying solely on traditional unsecured lending models, the platform integrates directly with banking systems, allowing financial institutions to convert existing assets into modern credit products.
This approach is expected to improve credit accessibility while helping banks manage lending risks more efficiently.
Supporting India’s Evolving Banking Ecosystem
India’s financial services sector is undergoing rapid transformation as banks increasingly adopt digital infrastructure to improve customer experiences and expand lending opportunities.
Spense has already partnered with seven major banks, supports more than 200,000 active credit cards, facilitates the issuance of over 40,000 new cards every month, and contributes to nearly 8 percent of India’s monthly credit card issuance.
The company plans to use the newly raised capital to strengthen partnerships with banks, accelerate product development, expand engineering and business teams, and introduce Credit Line on UPI (CLOU), a product designed to further integrate secured lending into India’s rapidly growing digital payments ecosystem.
According to Pawan Kumar, Co Founder and Chief Executive Officer of Spense, India’s credit challenge extends beyond lending risk.
“India’s credit challenge is often viewed as a risk problem. We believe it is fundamentally an infrastructure problem. India does not have a shortage of assets. It has a shortage of infrastructure that can convert those assets into usable credit.”
Unlocking the Value of Financial Assets
Spense believes the future of banking will be built around infrastructure capable of converting financial assets into accessible sources of credit.
Co Founder and Chief Technology Officer Srinivas Krishnamurthy described this transformation as the next phase of banking innovation.
“For decades, banks digitised accounts, payments and transactions. The next phase of banking is the digitisation of collateral itself.”
As India’s financial system becomes increasingly digital, asset backed lending is expected to emerge as a major growth segment, allowing customers to access liquidity without liquidating long term investments.
This model could improve financial inclusion while creating new lending opportunities for banks and fintech institutions.
Readers interested in India’s rapidly evolving fintech ecosystem can explore more business insights at https://www.wemindia.com/category/fintech/.
GrowthCap’s Long Term Investment Strategy
GrowthCap Ventures positions itself as an operator led venture capital firm focused on identifying high potential startups during their earliest stages of growth.
The firm primarily invests across FinTech, Artificial Intelligence and DeepTech, working closely with founders by providing strategic guidance, operational support, customer introductions and fundraising assistance alongside capital.
According to Pratekk Agarwaal, Founder and General Partner of GrowthCap Ventures, the firm’s early investment thesis centred on the belief that asset backed credit would become one of India’s defining financial services opportunities.
“We invested in Spense at the pre seed stage because we believed asset backed credit would become one of the defining themes in financial services. Pawan and Srinivas have demonstrated exceptional clarity of vision and execution, building infrastructure that enables banks to unlock liquidity against assets at scale.”
Outlook
India’s fintech sector continues to evolve rapidly as digital public infrastructure, UPI adoption and increasing financial digitisation create new opportunities for innovation across lending, payments and banking services.
Asset backed credit infrastructure is expected to become an increasingly important component of this evolution, enabling financial institutions to expand lending while improving risk management through collateral based products.
GrowthCap Ventures’ continued backing of Spense reflects growing investor confidence in startups building the foundational technology powering India’s next generation of financial services.
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