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AYE Finance

AYE Finance provides loans to MSMEs to help grow their business and generate more jobs for low-skilled workers


 Investee AYE Finance, founded 2014
 Location India
 Sector Financial Inclusion
 Funding start 2016
 Funding type Equity




  • In India, there are about 58 million MSMEs (micro and small enterprises) with large unmet borrowing needs, leading to a credit crunch among them stalling their growth.
  • Giving small-value loans is unviable for large financing firms due to high acquisition and credit assessment related costs and the typical loan ticket-size is too big for MFI’s.
  • If trends in India continue, about 423 million people will be unemployed or unable to participate in the job market by 2030. Since the job market is biased towards high-skill labor, the creation of low-skill jobs is vital to address this problem.
  • MSME's have the potential to double current employment in agricultural, manufacturing and services sectors. However, limited access to finance is the second-most cited obstacle for businesses in developing countries, right after unstable electricity.


AYE fills the current gap in financing of underserved MSMEs by providing them with loans for capital expenditure and working capital requirements. Aye offers loans ranging from USD 750 to USD 38’500, with monthly repayments over a 6 to 84-month period.

AYE uses an innovative industry cluster-based approach to access and evaluate borrowers and is already catering to the credit needs of more than 40 industry clusters across the country. For underwriting “thin file” customers, AYE uses proprietary technologies of psychometrics, behavioral mapping and business sciences for regenerating cash-flows.


MSMEs benefit from increased access to capital that is cheaper than other available sources in the market (informal money lenders) which helps them grow their business, increase profitability and resilience to market shocks, and employ more people.

By bridging the financing gap for MSMEs, AYE Finance creates a positive impact in mainstreaming informal businesses. Access to finance enables MSMEs improve their access to infrastructure of all kinds - enable better market linkages and market access, improve corporate governance and managerial competence by allowing them to hire talent, and use the latest and most efficient technology. These in turn have a compounded impact on the growth of an enterprise and can help sector participants become more organized and a part of the mainstream industrial ecosystem.

Impact Depth

  • Increased ability to accrue savings and absorb future shocks
  • Low-skilled labor enjoy increased job security (even during downturns), due to commercially stronger employers
  • More stable income allows low-income families to better plan for family life
Impact Reach 2016/17* 2017/18e*
# of active client organizations 15'264 65'526
# of loans disbursed 12'837 50'526
Loan Portfolio (US$ millions) 20.5 81.4

 * Fiscal year April to March


By investing in AYE Finance, we align with and contribute to three of the United Nations’ Sustainable Development Goals.

"We are happy to be partnering with LGT Impact for the next stage of our growth. LGT Impact has a proven track record of investing in quality growth companies. I look forward to our association as we take AYE Finance to its next stage of evolution to achieve our common vision of providing comprehensive financial services to small and micro enterprises to power the inclusive growth of the country.”

Sanjay Sharma, Co-Founder of AYE Finance