Chennai-based small business lender Veritas Finance Thursday announced that it has raised about $48.7 million (Rs 350 crore) in Series E fundingfrom new investor Kedaara Capital, along with the existing investors including Norwest Venture Partners (NVP), Lok Capital Growth Fund and the family of anchor investor P Surendra Pai.

Promoted in 2015 by D. Arulmany, Veritas, Non-Banking Finance Company (NBFC), Veritas Finance Private Limited is focused on lending to micro, small and medium enterprises. It has created a loan book of ₹1,308 crore as on February 29, 2020 with a customer base of 48,638 across eight states and one union territory.

The company proposes to use the additional capital to further penetrate into existing markets to augment the capital required by MSMEs for business expansion, working capital and for asset creation backed by transformative technology, robust credit appraisal systems and quality customer service.

Shiv Chaudhary, managing director of Norwest Venture Partners, India said, “MSMEs are engines of India’s economic growth and key enablers for employment generation at the grass-root level. We are excited to double our investment in Veritas Finance by allocating an additional ₹200 crore in this round”.

India is home to more than 60 million MSMEs who contribute to 45% of the exports and it forms the highest share of the employment sector in India, contributing around 69% to it.

Other players operating in the space include IndoStar Capital Finance, Vistaar Financial Services, Indifi, Lendingkart, Aye Finance, LoanTap, AU Financiers, and Satya Micro Capital.