AI Fintech Startup Kaaj Raises $3.8M to Revolutionize Small Business Lending with Automated Credit Risk Analysis

Credit risk automation platform Kaaj raises $3.8M seed from Kindred Ventures | TechCrunch

Shivi Sharma spent a decade working in credit risk at places like American Express and Varo Bank. At some point, she realized teams were spending equal amounts of time analyzing all types of loans -- regardless of whether it was worth $100,000 or $5 million -- meaning assessing smaller loans was ultimately an unprofitable and time-consuming process for lenders. She and her husband, Utsav Shah, realized there was an opportunity here. "She watched as the vast majority of small business owners couldn't access the capital they needed to grow, simply because the economics didn't work for banks," Shah told TechCrunch. "Between our skills in building AI-powered decision-making systems at scale and our expertise in credit risk and fraud risk assessments in banking in financial services, we realized we could apply next-gen AI agent workflows to solve this decades-old problem," he continued. The married couple decided to launch Kaaj in 2024, a company that helps automate credit risk analysis so that underwriting no longer takes days, but minutes. Kaaj said it's processed more than $5 billion worth of loan applications, with clients including Amur Equipment Finance and Fundr. The company announced on Wednesday a $3.8 million seed round from Kindred Ventures and Better Tomorrow Ventures. The product works like this: A small business applies for a loan, submitting all the needed documents (like financial statements, bank statements, and tax returns) -- typically, when this happens, underwriters spend days manually verifying all this information and logging it into their Loan Origination System (LOS). Kaaj uses AI to identify, classify, verify, and organize information into LOS. It also runs assessments to check for document tampering for the underwriter fraud team. It integrates into existing Customer Relationship Management (CRM) systems like Salesforce, HubSpot, or Microsoft and even shows a lender if a business is meeting the criteria of a lender's policy. "This allows a team processing 500 applications monthly to handle 20,000 applications with the same staff, making smaller loans economically viable," Shah, the company's CEO, said. The hope is that more small businesses will be able to access loans from banks because it becomes more cost-efficient for a bank to investigate them. Others in the market include Middesk, Ocrolus, and MoneyThumb. Sharma hopes that Kaaj will stand out from the competition by automating the entire credit analysis process rather than parts of it. "We do this by deploying agentic AI workflows that mimic their teams, to help lenders analyze end-to-end loan packages," she said. The fresh capital will be used to help accelerate product development and expand across independent and small business lenders. "We're focused on enhancing our AI agent capabilities, expanding our module offerings, and scaling our customer base of lenders and brokers beyond our current footprint." Overall, Shah and Sharma hope Kaaj can in some ways "revolutionize" small business lending, bringing automation to what is still a very paper-heavy process. "By automating the science of credit analysis, we free up human underwriters to focus on the art of deal-making and subjective assessment, which is their true competitive advantage," he said.

AI fintech startup Kaaj raises $3.8 million from Kindred Ventures, others

Founded in 2024 by husband-wife duo Utsav Shah and Shivi Sharma, Kaaj aims to expand access to affordable capital for all small businesses. The startup uses agentic AI workflows to help lenders analyse end-to-end loan packages, create analyses for small-business lending, and cut costs. Kaaj, an agentic AI credit intelligence platform, on Wednesday announced that it has raised $3.8 million in a seed funding round led by Kindred Ventures, with participation from Better Tomorrow Ventures and others. Founded in 2024 by husband-wife duo Utsav Shah and Shivi Sharma, Kaaj aims to expand access to affordable capital for all small businesses. The startup uses agentic AI workflows to help lenders analyse end-to-end loan packages, create analyses for small-business lending, and cut costs. Kaaj's AI agents automate the entire credit analysis process, including business verification, cash-flow analysis and asset valuation. This process, which traditionally takes underwriters days of manual work, is compressed into minutes through the platform. Both Shah and Sharma have strong tech backgrounds. Shah spent a decade at Uber and Cruise, while Sharma is an expert in credit and fraud risk, having worked at American Express, Uber, and Varo Bank. The fresh capital will be used to accelerate product development and expand Kaaj's reach into the $1.7 trillion US small-business lending market and $1.3 trillion equipment finance market. "Time kills deals in small-business lending," said CEO and cofounder Shah. "When multiple lenders compete for the same quality borrowers, speed determines winners. Faster, more consistent decisions with clear data help brokers reduce administration time and focus on delivering bespoke advice and guidance for small businesses," he said. The platform has already processed over $5 billion in loan applications and serves customers such as Amur Equipment Finance, Quality Equipment Finance, and Fundr, it said in a statement. "Small-business lending has long struggled with a fundamental economics problem -- the cost to underwrite smaller loans hasn't matched the returns, leaving millions of businesses underserved. Kaaj is solving this," said Kanyi Maqubela, Managing Partner, Kindred Ventures.

AI credit intelligence platform Kaaj raises $3.8m

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community. The round was joined by Better Tomorrow Ventures, Karman Ventures, Pythia Ventures, Coughdrop Capital, and a host of angels, including Sardine AI CEO Soups Ranjan and TreasuryPrime COO Remy Carole. Founded in 2024, Kaaj uses agentic AI workflows to help lenders analyse end-to-end loan packages and create decision-ready analysis for small business lending, promising to reduce lender costs and accelerate decision-making. Co-founder and CEO Utsav Shah spent a decade at Uber and Cruise, building AI-powered decision-making systems, while co-founder and president Shivi Sharma is an expert in credit and fraud risk with experience at American Express, Uber, and Varo Bank. According to the Federal Reserve 2024 Small Business Credit Survey, about 50% of small business loan applicants fail to receive the full amount of capital they need. Kaaj says that a major reason for this gap is that for most lenders, loans under $1 million are not profitable using current manual, time-intensive underwriting approaches. To solve this, the startup's platform deploys AI agents that work together to automate the entire credit analysis process, from business verification and cash flow analysis to asset valuation, financial analysis, and risk assessment. What traditionally takes underwriters days of manual work across thousands of documents, Kaaj claims to complete in under three minutes, delivering decision-ready analysis that integrates seamlessly into existing loan origination systems. Says Sharma: "Kaaj's platform doesn't just speed things up. It fundamentally changes the economics of small business lending, making smaller loans profitable for lenders while improving the borrower experience."