Avana promises $25 million India investment after NBFC licence from RBI

US-based Avana Companies, which runs a commercial bank in Texas and manages assets of $1 billion at the group level, has secured a non-banking finance company (NBFC) licence from the Reserve Bank of India.

The company’s cofounder and chief executive Sundip Patel, a second generation immigrant, told ET that he has capitalised the NBFC with $1.5 million for the licence requirements and will invest another $10 million to grow the business in India.

“Then we will ratchet up to $25 million in about three years; that's our goal,” he said.


The company has hired Siddharth Purandare, who was previously the head of SME (small and medium enterprises) business at Edelweiss Financial Services as its managing director for India operations.

As the lender starts out, it wants to focus on the hospitality segment. It will cater to the financing needs of mid-sized hotels, which find it hard to secure financing from formal banking channels.

“We are looking at the ability to provide import-export financing for small businesses, which operate between these three locations – India, the USA and the Gulf region,” Patel said.

Avana Companies, a group of financial services firms, also has business operations in the Kingdom of Saudi Arabia.

In India, if the company manages to build a $1 billion business over the next five to seven years, it will have a team of about 120 people, said Patel.

The lender will operate in a manner that the customer onboarding will be through digital channels, but for servicing of loans and collections there will be a physical team present on the ground. It will have branches in the major cities of the country which will act as hubs for regional operations.

The company will also work closely with loan sourcing agents to acquire customers.

Talking about growth plans, Patel said that he wants to replicate the strategy that he deployed in the US, where he built the financial services business starting from Arizona and slowly expanding to other states.

The company will focus on doing business in Maharashtra and then scale up from there.

While Patel was born in Africa to Gujarati parents who had emigrated from India, he has run a software business in India earlier. He has been running Avana Companies for the past 24 years.