Pune-based Prachay Capital Limited is an RBI-registered Non-Banking Financial Company (NBFC), whose growth epitomises the evolving landscape of India’s financial ecosystem. Girish Lakhotiya, Founder and CEO, is a first-generation entrepreneur and seasoned finance professional. His journey into entrepreneurship was driven by a profound desire to address critical gaps he observed in India’s financial landscape, particularly for underserved first-generation entrepreneurs.
A Chartered Accountant by qualification, Lakhotiya began his career at Citibank in financial management and corporate lending. When the subprime crisis disrupted global financial markets in 2008-09, exposing significant weaknesses in traditional banking, he pivoted away from corporate finance. He identified an opportunity to create a financial platform that prioritised a customer-centric and flexible lending ecosystem for businesses overlooked by conventional institutions.
Prachay Capital’s NBFC was initially launched using investments from fees earned through their advisory business, later raising two rounds of funding for expansion from local investors. Their funding approach inspired a business model that embraced alternative financial vehicles. The firm has developed a portfolio of unique financial products aimed at fostering equitable economic growth. Its mission extends beyond providing access to capital; it seeks to redefine lending as a premium, personalised experience. Unlike conventional banks and NBFCs, Prachay adopts a holistic approach to lending, addressing the specific needs and aspirations of each business.
Recognising the slow maturation of India’s corporate bond market, Prachay has leveraged this gap by offering flexible, alternative debt solutions through privately placed corporate bonds for small and medium-sized businesses. These businesses, often dismissed as ‘too risky’ by traditional banks, access capital through corporate bonds, offering more attractive terms than conventional loans. This strategy bridges critical funding gaps and empowers businesses to leverage debt as a growth tool, enabling scaling without reliance on traditional equity funding. Prachay’s bonds deliver annual returns in the 12-13 per cent range, significantly outperforming other investment options.
Prachay has also made a substantial impact in the real estate sector, particularly in the Pune region, long constrained by restrictive banking policies and inflexible financing structures. Over the years, the company has developed 17 specialised financial products tailored to the needs of real estate developers. These products address key challenges, including timely fund disbursements, project cash flow management, and long-term sustainability. Prachay has been instrumental in helping developers overcome financial obstacles, pushing their projects forward and driving growth and efficiency across the sector.
Lakhotiya views India’s financial sector as a cornerstone of the nation’s economic resurgence. As India’s economy continues its rapid expansion, the country must establish a financial infrastructure that supports this aspirational growth. Prachay’s mission aligns seamlessly with this vision, focusing on empowering businesses of all sizes with financial solutions that enable them to thrive in an increasingly competitive marketplace.
“Financial literacy is a key part of our strategy. By educating businesses and investors, we are creating a more robust financial ecosystem. This initiative is particularly significant for Micro, Small, and Medium Enterprises (MSMEs), forming the backbone of India’s economy. Empowering MSMEs with better access to financing is central to our mission of driving inclusive economic growth,” explains Lakhotiya.
The next big step
Looking ahead, Prachay is preparing for its Bond IPO. This will democratise investment opportunities with a minimum commitment of R.10,000. This growth strategy includes partnering with mid-to-large enterprises across various industries, fostering relationships and cultivating an inclusive financial environment. The business is projecting a book size of R.200-300 crore by the end of next year.
With its focus on innovation, inclusivity and long-term sustainability, Prachay is poised to play a transformative role in shaping India’s financial future, propelling the country towards equitable, global economic competitiveness. In 5 years, the company has achieved their milestones, facilitating $1 billion in transactions and supporting over 400 businesses. As Prachay continues to expand its offerings, it is redefining how businesses perceive and utilise capital in their pursuit of success. The company’s philosophy is rooted in the belief that entrepreneurs are India’s most impactful citizens, and by empowering them, Prachay is contributing to the nation.