Chennai-based non-banking financial company (NBFC) Dugar Finance has raised $5 million (Rs 45 crore) in a pre-Series A funding round led by HegdInvst, a Category II AIF focused on growth equity investments.
The NBFC had earlier raised $18 million (about Rs 160 crore) in a debt funding round led by Swiss-based investor Symbiotics, with participation from leading Indian banks including Union Bank of India and Karur Vysya Bank in December last year. It also raised $3 million in debt from the $75 million Green Basket Bond issued by Symbiotics Investments in June last year.
The fresh funds will be deployed across four key areas: strengthening technology infrastructure, advancing analytics-led underwriting, building centralised risk systems, and hiring senior talent across critical functions, the company said in a press release.
Led by Ramesh Dugar, Dugar Finance is an impact-focused, non-deposit-taking NBFC operating across multiple states in India, with a strong presence in tier 3 and tier 4 markets. The company specialises in secured MSME and commercial vehicle financing aimed at income generation. It supports micro-entrepreneurs, small businesses, and first-time commercial vehicle drivers who remain underserved by formal credit.
While historically anchored in commercial and passenger vehicle finance, Dugar Finance is expanding its presence in secured MSME lending, aiming to build a more balanced and diversified loan book across both segments.
Dugar Finance currently operates across six states and plans to expand to ten states over the next three years. The company is targeting Rs 2,000 crore in AUM over the next 3–4 years, while aiming to maintain GNPA below 2% and RoA in the 4–5% range.
The company also aims to progressively move toward a more even mix between secured MSME and commercial vehicle financing, improving resilience across credit cycles.
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