Aavishkaar Capital invests Rs 60 crore in debt relief platform FREED

MUMBAI: Impact investor Aavishkaar Capital has led a Rs 60 crore investment in FREED, with participation from existing investors Sorin Investments, Piper Serica and Sattva Ventures, as unsecured retail lending and household leverage rise in India.

Debt relief is a $50.0 billion industry across the US and other advanced markets. The latest funding comes at a time when consumer credit penetration is deepening in India and structured, compliant debt resolution is emerging as a necessary layer of financial infrastructure.

Founded in 2020, the company positions itself as India’s first comprehensive debt relief platform. It was set up to help consumers settle unsecured loans amid rising retail debt after Covid.

Founder Ritesh Srivastava, who has experience in US debt settlement, brought together his team in May 2020 during Covid-related loan defaults and RBI moratoriums. The platform was launched in Aug 2020 after consultations with consumers, bankers and advocates.

“This investment strengthens our ability to scale responsible debt relief solutions at a time when household indebtedness is rising sharply across the country. We remain committed to creating transparent, tech-led pathways that give consumers a real chance at financial rehabilitation,” said Srivastava.

The firm operates a technology-driven, borrower-focused model built on behavioral insights, data intelligence and cash flow-based evaluation. It provides financial counselling, negotiated settlements and structured repayments through trustee-managed special purpose accounts for borrowers facing hardship. For repayment-capable but stressed borrowers, it assesses affordability and facilitates structured consolidation loans through regulated lending partners. It also supports credit rebuilding.

Since inception, the platform has counselled over 20,00,000 customers and manages more than 1,20,000 active accounts.

It has overseen over Rs 3,200 crore in debt under management. In earlier stages, it enrolled over Rs 350 crore in debt from more than 6,500 customers. It has also enrolled over Rs 1,200 crore in debt from more than 25,000 customers at different points in its growth.

The company aims to enrol around $1.0 billion in stressed debt over the next 18 months.

In May 2022, it raised $2.8 million, or around Rs 22.0 crore, in a pre-Series A round led by Inflection Point Ventures with participation from Multiply Ventures and angel investors. In March 2024, it secured $7.5 million, or around Rs 60.0 crore, in a Series A round led by former Citibanker Sanjay Nayar’s Sorin Investments and Multiply Ventures.

The fresh capital will be deployed to scale operations, expand geographic reach, strengthen product and underwriting capabilities, and deepen institutional partnerships. The company has reported monthly growth of 10–12% with sustainable unit economics. Management said the business has shown operating leverage and is on a path to profitability.