For much of his career, Pankaj Poddar’s job was to think about what could go wrong with a loan. As a credit and risk executive, he spent close to two decades across institutions including Kotak Mahindra Bank, Standard Chartered Bank, Bajaj Finance, and SBFC Finance, looking at lending through the prism of underwriting, portfolio quality, operating costs and profitability. “The long-term purpose, however, was always to be an entrepreneur,” Poddar tellsYourStory. He is now Founder, Managing Director, and CEO of Business Nextgen Finance Private Limited (BNF), a young non-banking financial company (NBFC) focused on secured lending to small entrepreneurs, particularly outside India’s biggest financial centres. That ambition has just received a significant boost. BNF has raised Rs 215 crore in equity capital from a group of institutional and strategic investors as it prepares to scale its MSME lending business. The round was led by Beams Fintech Fund I and its affiliates, Baring Private Equity India Fund 6, Saison Capital, and UNLEASH 1st Investment Partnership, along with other investors. The transaction has received prior approval from the Reserve Bank of India. Beams and its affiliates will collectively hold more than 26% of BNF’s paid-up equity share capital on a fully diluted basis following the transaction. The capital will be used to expand BNF’s secured lending business, widen its geographic footprint and invest further in technology. For a lender that received its RBI Certificate of Registration only in September 2025, the fundraise gives BNF the capital to test a thesis Poddar has developed over years of looking at small-business credit: a large lending opportunity remains untapped beyond India’s top 100 markets. “The significant credit gap in India's underserved MSME segment presents a compelling opportunity for a differentiated lender with strong underwriting, technology and customer-centricity,” says Sagar Agarwal, Partner at Beams. According to Poddar, roughly 70% of secured MSME and mortgage credit is concentrated in India’s top 100 geographies. BNF wants to go beyond them. Its long-term ambition is to build a presence across as many as 1,000 locations, with a particular focus on smaller cities and towns where entrepreneurs may have viable businesses and assets but do not always fit neatly into conventional underwriting frameworks. Poddar says BNF envisaged a pan-India model from the outset, with both its North and South zones going live from day one. Many of the small businesses BNF wants to lend to may not have conventional documentary proof of income. Property records are not uniformly digitised. Collateral can be more complicated to assess outside large cities. And determining whether a small entrepreneur can repay a loan often requires looking beyond tax returns. BNF’s loans are largely in the Rs 5 lakh to Rs 30 lakh range, with an average ticket size of around Rs 10-12 lakh. The average interest rate is currently about 17-18%, acco
