Optimo Capital Secures $17.5 Million in Funding for Expansion and AI-Driven Lending

Optimo Capital, a lender focused on loans against property, has successfully closed a significant funding round, raising $17.5 million in equity. This round was led by the company's founder, Prashant Pitti, with participation from existing investors Blume Ventures and Omnivore. In addition to the equity, Optimo Capital secured debt financing of just under $12.5 million from IDFC Bank and Axis Bank. This brings the company's total equity fundraising to $27.5 million.

The company targets medium and small business entrepreneurs in tier-2 and tier-3 cities, offering loans against commercial or residential property as collateral, typically at lower rates than unsecured loans. The fresh capital will be used for aggressive expansion, with plans to enter six more cities and reach a total of 80 branches by the end of the fiscal year, with future expansion into northern and western India. Optimo Capital currently operates in 56 cities across Karnataka, Tamil Nadu, Telangana, Andhra Pradesh, and Madhya Pradesh. The NBFC aims to double its assets under management from ₹350 crore to ₹700 crore by the end of FY26. A portion of the new funds will also enhance its technology infrastructure, particularly its artificial intelligence (AI) capabilities. Optimo Capital uses 7.7 million digital land records combined with AI to speed up loan disbursal and employs an AI agent to assist potential borrowers. The loan against property segment is growing rapidly at a 15.34% CAGR in India's home mortgage market, but challenges like low borrower awareness and high monitoring costs persist. Prashant Pitti, also a co-founder of EaseMyTrip, launched Optimo Capital in 2023 and previously raised $10 million in seed funding.

Impact This funding signifies strong investor confidence in India's NBFC and fintech sector, especially in companies serving smaller cities. It enables Optimo Capital to scale operations and leverage AI for efficiency, potentially capturing a larger share of the growing loan-against-property market. This could lead to increased competition and innovation, benefiting small and medium businesses. Impact Rating: 7/10

Difficult Terms NBFC (Non-Banking Financial Company): A financial institution that provides banking-like services but does not hold a full banking license. They offer services such as loans and credit facilities. CAGR (Compound Annual Growth Rate): The average annual growth rate of an investment or metric over a specified period, assuming profits are reinvested. AI agent: A software program using artificial intelligence to perform tasks, such as interacting with users to provide information or assistance. Digital land records: Electronic versions of official documents detailing land ownership, boundaries, and other information. Tier-2 and Tier-3 cities: Cities in India ranked by population and economic activity, with Tier-1 cities being the largest metropolitan areas.