OnFinance AI Raises $4.2 Million Pre-Series A to Revolutionize BFSI Sector with Generative AI

In a significant development for the AI and fintech ecosystem, OnFinance AI announced that it has successfully raised $4.2 million in a Pre-Series A funding round. The round was led by Peak XV’s Surge, with notable participation from Shyamal Hitesh Anadkat of OpenAI, Groww Founders’ Fund, MarsShot VC, Climber Capital, Indian Angel Network (IAN), and Silverneedle Ventures (SNV). This funding will primarily support the company’s expansion of proprietary generative AI models, accelerate its research and development initiatives, and enable its entry into international markets, including the United States and the Middle East and North Africa (MENA) regions.

Founded in 2023, OnFinance AI is a technology start up headquartered in Bengaluru, India, that leverages generative AI solutions to transform the Banking, Financial Services, and Insurance (BFSI) sector. The company aims to streamline compliance, risk management, and customer experience by integrating artificial intelligence into traditionally complex financial workflows. By automating routine processes, OnFinance AI reduces operational inefficiencies while enhancing the speed and accuracy of regulatory compliance, a critical factor in today’s highly regulated financial ecosystem.

The startup was co-founded by Anuj Srivastava and Priyesh Srivastava. Anuj Srivastava, the CEO, is a 2020 alumnus of BITS Pilani (Goa campus), where he earned a Bachelor of Engineering degree with a minor in Finance & Economics. Before founding OnFinance AI, Anuj gained experience in data science and analytics roles at companies like Rapido, and has been recognized in the Forbes 30 Under 30 Asia list for his contributions to the fintech and AI sectors. Priyesh Srivastava, the CTO, brings a strong technical background, specializing in AI model development and machine learning. Together, Anuj and Priyesh have combined their expertise in finance and technology to build OnFinance AI’s innovative AI-driven financial solutions.

OnFinance AI’s primary product offerings include a suite of AI-driven compliance and risk management tools. These tools utilize generative AI to analyse vast amounts of financial data in real time, identifying anomalies, assessing risk exposure, and providing actionable insights to compliance teams. For banks and financial institutions, this translates into reduced manual workload, faster decision-making, and enhanced accuracy in meeting regulatory standards. The company also provides predictive modelling capabilities, allowing institutions to anticipate potential risks before they escalate. This proactive approach is particularly valuable in areas such as fraud detection, anti-money laundering (AML) monitoring, and credit scoring, where timely insights are crucial.

The company’s AI models are built using state-of-the-art natural language processing and machine learning techniques, enabling them to interpret and process complex financial data from diverse sources, including transaction records, regulatory filings, and market news. One of the key differentiators for OnFinance AI is its focus on context-aware AI, which understands financial regulations and operational procedures in specific regions. This allows the models to provide insights that are not only data-driven but also aligned with local compliance requirements, a factor that is often overlooked in generic AI solutions.

With the new funding, OnFinance AI plans to expand its operations globally, starting with the US and MENA regions. These markets are experiencing a surge in demand for AI-driven financial solutions, particularly in areas like digital banking, insurance tech, and investment advisory. By establishing a presence in these regions, OnFinance AI aims to cater to a wider client base and address region-specific regulatory and operational challenges. Additionally, the funding will enable the company to scale its R&D capabilities, hire top-tier AI researchers and engineers, and enhance its platform’s capabilities for handling large-scale, enterprise-grade financial data.

Industry experts have highlighted the importance of AI in reshaping the BFSI sector. According to a recent report by Gartner, financial institutions are increasingly investing in AI to optimize compliance, enhance customer experience, and improve operational efficiency. OnFinance AI’s approach aligns with this trend, offering a comprehensive AI toolkit that can be customized for different financial entities, ranging from traditional banks to emerging fintech companies.

The involvement of high-profile investors such as Shyamal Hitesh Anadkat of OpenAI adds credibility to OnFinance AI’s mission. The participation of multiple venture funds and angel investors also reflects confidence in the start up’s ability to deliver measurable value to the BFSI sector. By combining technical prowess with domain expertise, OnFinance AI is positioned to become a key player in the global AI-fintech ecosystem.

Looking ahead, OnFinance AI is expected to introduce new AI products and features aimed at predictive compliance, real-time financial monitoring, and enhanced customer engagement. The company is also exploring partnerships with banks and financial institutions to integrate its AI solutions directly into their existing workflows. By doing so, OnFinance AI hopes to reduce operational friction, enhance regulatory adherence, and drive greater transparency across financial processes.

In conclusion, OnFinance AI’s latest funding round marks a significant milestone for the start up, underscoring investor confidence in AI-driven transformation within the BFSI sector. With a strong leadership team, innovative technology, and a clear global expansion strategy, the company is well-positioned to redefine how financial institutions leverage AI for compliance, risk management, and operational excellence. The coming months are expected to witness accelerated adoption of OnFinance AI’s solutions, establishing the start up as a pioneering force in the intersection of finance and artificial intelligence.