Chargeup secures INR 50 crore credit line for commercial EV financing

Chargeup has partnered with Mega Corporation Limited and Shivakari Finance to establish a combined credit line of INR 50 crore for commercial electric vehicle financing. The collaboration aims to deploy 4,000 commercial EVs over the next 12 months, targeting last-mile drivers across India.

The partnerships address challenges that have limited EV financing in India's commercial vehicle segment. Traditional lenders, particularly non-banking financial companies, have been reluctant to finance EVs due to concerns about battery performance, resale value uncertainty, and borrowers with limited credit histories. These factors have resulted in higher non-performing assets and restricted loan approvals.

Varun Goenka, Founder and CEO of Chargeup, said EV financing has posed risks for lenders due to an unstructured resale market, uncertain battery performance, and borrowers with low credit history. These factors often result in higher NPAs and limited loan approvals, hampering EV adoption at the grassroots level.

Chargeup operates as an asset management and financial services platform that uses driver and battery behavior data to mitigate credit risks and improve asset utilization. The company provides digital underwriting and real-time tracking services to financial institutions entering the EV financing market.

For Mega Corporation, the partnership represents an entry into EV financing. Joydeep Dutta, Vice President and Business Head of Mega Corporation, said the collaboration provided an instant go-to-market opportunity in the EV domain with the technology, trust and speed needed to scale in an untapped market.

Shivakari Finance has transitioned from financing e-rickshaws to i-rickshaws through the partnership. Nandita Monga, Vice President at Shivakari Finance, said Chargeup's technology approach has simplified operations, made assets more secure and reduced NPAs.

The commercial EV financing sector in India has grown as the government pushes for electric mobility adoption through subsidies and policy support. However, financing remains a bottleneck for drivers seeking to transition from conventional vehicles to electric alternatives, particularly in the last-mile delivery and passenger transport segments.

Chargeup has previously facilitated over INR 8.64 crore in EV disbursements through a partnership with Ascend and claims to have enabled EV ownership for over 8,000 drivers. The company uses data analytics to assess driver behavior and vehicle performance, which it says helps lenders make informed decisions about loan approvals.

The partnership comes as India's EV market continues to expand, with commercial vehicles representing a significant portion of the adoption due to their higher utilization rates and total cost of ownership benefits compared to passenger vehicles. Last-mile delivery and ride-hailing segments have emerged as early adopters of electric commercial vehicles.

Financial institutions are gradually warming to EV financing as battery technology improves and resale markets develop. The involvement of specialized platforms like Chargeup provides lenders with data-driven insights and risk mitigation tools that were previously unavailable in the traditional vehicle financing model.