The Indus Tech Desk | Fintech Startup Niro Shuts Down After 4.5 Years of Operations
India’s fast-evolving fintech ecosystem has seen another major exit — Bengaluru-based fintech startup Niro has officially shut down after operating for over four years. The announcement was made by co-founder Aditya Kumar through an emotional post on LinkedIn, marking the end of what many considered one of the most promising embedded lending ventures in India.
Founded in 2021 by Aditya Kumar and Sankalp Mathur, Niro operated as a B2B2C lending platform, enabling consumer internet companies to seamlessly offer embedded credit solutions to their users. The company quickly rose to prominence for bridging the gap between financial institutions and internet platforms, facilitating millions of small-ticket loans to consumers across India.
A Vision to Power Embedded Finance in India
When Niro launched, it aimed to simplify credit access for India’s growing digital population. The platform worked with large internet companies—such as e-commerce apps, online travel portals, and fintech aggregators—to embed credit offerings within their ecosystems.
Through these partnerships, Niro provided personal loans ranging from ₹50,000 to ₹7 lakh, with repayment tenures from 6 to 72 months and interest rates between 12% and 28%, depending on risk profiles.
Its technology-first approach allowed partner companies to integrate loan products into their user journeys with minimal friction. For borrowers, this meant instant access to credit; for partners, a new revenue channel; and for lenders, access to a large, digitally verified customer base.
Rapid Growth and Strong Investor Confidence
Within just two years of operation, Niro achieved remarkable growth milestones. The startup built an impressive $100 million in assets under management (AUM) and recorded over 170 million user flows on its platform at its peak.
The company raised $20 million in total funding from marquee investors, including Elevar Equity, GMO Venture Partners, Rebright Partners, Mitsui Sumitomo Insurance Venture Capital, and Innoven Capital.
This capital allowed Niro to expand partnerships with over 30 leading internet platforms and collaborate with multiple banks and non-banking financial companies (NBFCs) to disburse more than $200 million in loans.
Aditya Kumar and his team positioned Niro as a “lending infrastructure layer” for digital businesses — a category that quickly gained traction amid India’s fintech boom between 2021 and 2023.
Fintech Startup Niro Shuts Down : Regulatory and Capital Pressures
However, the momentum slowed in 2024 as the fintech sector faced increasing regulatory scrutiny. According to Kumar, a series of external pressures created what he described as a “perfect storm” for embedded lending startups.
In his LinkedIn post, Kumar wrote:
“As a first-mover that saw scale quickly, I did not see this coming. We had done the impossible — built an incredible team, raised high-quality capital, and convinced large consumer internet platforms and leading lenders to work with us. Despite scouring the globe for capital and the country for suitors — I wasn’t able to bring this one home.”
The tightening of digital lending regulations by the Reserve Bank of India (RBI), coupled with credit deterioration and restricted capital flows, made it increasingly difficult for Niro to sustain its operations.
With venture capital funding slowing across fintech globally and domestic lenders growing more risk-averse, Niro struggled to maintain liquidity and investor confidence despite multiple attempts to pivot its business model.
Inside the Challenges: The Fintech Reality Check
Industry experts believe Niro’s closure reflects a broader trend in India’s fintech industry. Over the past two years, regulators have imposed stricter norms on digital lending, including limitations on first-loss default guarantees (FLDG) and requirements for greater transparency in loan disbursements.
For startups like Niro, whose business models depended on partnerships between banks, NBFCs, and digital platforms, these regulatory shifts created operational friction. Additionally, rising non-performing assets (NPAs) in the personal loan category forced lenders to become more conservative, shrinking the available credit supply.
A Bengaluru-based venture analyst commented that while embedded lending has immense potential, startups in the sector must “adapt to a slower, compliance-heavy growth path rather than rapid scaling.”
Reflections and Gratitude from the Co-founder
Despite the tough outcome, Aditya Kumar’s post struck a tone of gratitude and reflection. He praised his team, investors, and partners for their resilience during challenging times.
“We had the right idea, at the right time, with the right people and investors. Even if I could rewind time, I would do it all over again,” he said.
Kumar personally thanked Elevar Equity, along with individuals Jyotsna, Sandeep Farias, and Shikha, for their unwavering belief in Niro’s vision.
He also highlighted that while financial institutions continue to look for innovative ways to access quality consumer data for underwriting, the regulatory environment and limited appetite for risk have slowed innovation in the space.
What’s Next for Aditya Kumar and India’s Fintech Space
Kumar mentioned that he plans to take some personal time off to decompress and will be attending the upcoming Global Fintech Fest as a “civilian” this year. He expressed optimism about the future of fintech in India, noting that the ecosystem continues to evolve with new regulatory clarity and maturing infrastructure.
His departure from Niro symbolizes both the challenges and opportunities ahead for startups in the financial services sector. While 2021–2023 marked a period of rapid fintech innovation, 2024–2025 is shaping up as an era of sustainable, compliance-driven growth.
Experts believe that the next generation of fintech founders will likely focus on collaboration with regulators, profitability, and responsible lending practices, learning from the journeys of pioneers like Niro.
Industry Reaction and Lessons Learned
The news of Niro’s shutdown has sparked conversations across the startup community about the volatility of the fintech landscape. Many founders have acknowledged that while fintech innovation has democratized access to credit, sustainability remains a key challenge.
As one investor posted online, “Niro’s story is a reminder that in fintech, even strong fundamentals can struggle against macro headwinds. But their contribution to embedded finance in India will not be forgotten.”
Niro’s legacy lies not only in its technology or loan volumes but also in the confidence it built among financial institutions to explore embedded credit solutions — paving the way for future innovation.
Conclusion
The closure of Niro underscores the complexities of building in the fintech space — where innovation, regulation, and risk constantly intersect. While its journey ended sooner than expected, the startup’s impact on India’s embedded lending ecosystem remains significant.
As Aditya Kumar aptly summarized, Niro was “in the right place, at the right time, with the right backing.” Though the chapter has closed, its lessons will continue to inspire the next wave of fintech entrepreneurs in India.
