Spense Raises $2.8 Million Seed Round Led by Arkam Ventures to Build India's Asset-Backed Credit Infrastructure
Spense secures $2.8 million seed round funding led by Arkam Ventures to build asset-backed credit infrastructure for Indian banks. The Bengaluru startup powers over 2 lakh active cards and grew revenue 256% in FY25.
Bengaluru-based banking infrastructure startup Spense has closed a $2.8 million Seed funding round led by Arkam Ventures, with participation from Razorpay Ventures, GrowthCap Ventures, and Atrium Ventures. The round also saw cheques from a clutch of prominent fintech and technology operators.
The company, founded in 2022 by Pawan Kumar and Srinivas Krishnamurthy, builds bank-native infrastructure that enables financial institutions to launch credit cards and credit lines backed by customer assets such as fixed deposits, mutual funds, equities, bonds, invoices, and real estate, without replacing their existing technology stack.
Spense Funding: Where the Capital Goes
The capital will be deployed across four priorities: deepening banking partnerships, accelerating product development, expanding engineering and go-to-market teams, and launching Credit Line on UPI (CLOU), a product Spense describes as the next evolution of asset-backed credit access in India.
Spense Investors and Angels
The round draws participation from operators with deep roots across Indian fintech, enterprise SaaS, and AI.
| Investor | Organisation |
|---|---|
| Kunal Shah | CRED |
| Madhusudhan E | KreditBee |
| Ravishankar | Active.ai |
| Suresh Rayasam Venkatasubbaih | |
| Sayandeb Banerjee | The Math Company |
On the institutional side, Arkam Ventures led the round. The firm's portfolio includes Skyroot Aerospace, Jar, KreditBee, Wint Wealth, and SpotDraft, among others. GrowthCap Ventures, which had also led Spense's prior $1.85 million Seed round in May 2025, participated again, a notable signal of conviction from an existing backer.
Spense Total Funding Raised
This latest round takes Spense's total disclosed equity funding to approximately $4 million across multiple closes.
| Date | Round | Amount | Lead Investor |
|---|---|---|---|
| Nov 2022 | Seed | $350K | QED Innovation Labs |
| May 2025 | Seed | $1.85M | GrowthCap Ventures |
| Jul 2026 | Seed | $2.8M | Arkam Ventures |
Spense Revenue, Growth, and Key Metrics
Spense currently works with seven major banks across India, including one of the country's largest public sector banks, and a growing network of fintech distribution partners. The platform powers over two lakh active cards and issues upwards of 40,000 cards every month, representing nearly 8% of India's monthly credit card issuance.
Financially, the company has moved fast. Revenue grew 256% year-on-year in FY 2024-25, reaching INR 2.71 crore from INR 76 lakh in the prior year. The company also turned net profitable in FY25, posting a net profit of INR 53.9 lakh after two years of losses.
| Metric | FY 2022-23 | FY 2023-24 | FY 2024-25 |
|---|---|---|---|
| Revenue | INR 108 | INR 76L | INR 2.7Cr |
| Total Expenses | INR 1.1Cr | INR 2Cr | INR 2.8Cr |
| Employee Expenses | INR 81.3L | INR 1.6Cr | INR 2.5Cr |
| EBITDA | (INR 1.1Cr) | (INR 1.2Cr) | INR 1.5L |
| Net Profit / (Loss) | (INR 1.1Cr) | (INR 1.2Cr) | INR 53.9L |
Source: MCA filings. FY 2022-23 revenue figure reflects early-stage operations.
How Spense's Asset-Backed Credit Infrastructure Works
Spense's core argument is that India's credit challenge is not a risk problem but an infrastructure problem. Vast pools of financial assets across households, businesses, and institutions remain disconnected from formal credit because the plumbing required to convert them into usable credit products is fragmented, manual, and expensive to operate.
The company draws a direct parallel to the credit card: just as credit cards transformed unsecured borrowing from a one-time transaction into an always-available utility, Spense wants to do the same for secured, asset-backed credit. Its platform connects core banking systems, deposit systems, and card management systems in real time, and runs agentic AI on top to automate onboarding, servicing, collections, and customer support at scale.
Commenting on the fundraise, Pawan Kumar, Co-founder and CEO of Spense, said, "India's credit challenge is often viewed as a risk problem. We believe it is fundamentally an infrastructure problem. India does not have a shortage of assets. It has a shortage of infrastructure that can convert those assets into usable credit. If you have a valuable asset, you should have access to modern credit."
Srinivas Krishnamurthy, Co-founder and CTO of Spense, added, "For decades, banks digitized accounts, payments and transactions. The next phase of banking is the digitization of collateral itself. When assets become programmable, credit becomes real-time. When AI becomes operationally reliable, banking becomes dramatically more scalable. Together, these shifts will redefine how financial institutions originate, operate and service credit."
From the Investor
Commenting on the investment, Bala Srinivasa, Managing Director at Arkam Ventures, said, "We backed Pawan and Srinivas because we believe Spense is building foundational infrastructure for the next era of credit in India. As credit shifts toward safer, asset-backed models, platforms like Spense will play a critical role in helping financial institutions scale responsibly while expanding access to formal credit."
Spense's long-term vision is for every valuable asset, whether a fixed deposit, an equity portfolio, or a business's receivables, to be convertible into instant, reusable, and rewarding credit products through its platform.
Muskaan Kapoor
