When Hemanth Aluru and Sudhindra Reddy exited the C-suite at Zoomcar in 2022, they left with a specific conviction: India’s commercial transport sector was ready for electrification, but the banking sector wasn’t.
Hardware availability wasn’t the issue; the bottleneck was credit. Now, Turno, the EV-focused fintech platform they built to bridge that gap, has raised $5.5 million in a pre-Series B round. The financing was led by Stellaris Venture Partners, with participation from B Capital, Quona Accion Inclusion Fund, and existing backer British International Investment (BII), according to sources familiar with the deal.
The fresh capital targets the unsexy but vital plumbing of the green transition: underwriting loans for small fleet owners who are often ignored by traditional lenders.
Everyone talks about chargers, grid, and policy. But the real question on the ground is simple: who will write the loan for the driver?
The Depreciation Dilemma
Turno launched in April 2022, but the thesis was formed while the founders were observing the struggles of ride-hailing drivers. Commercial vehicles account for roughly 80–85% of India’s automotive fuel consumption. While switching to electric makes economic sense for drivers facing high diesel prices, financing that switch is notoriously difficult.
Banks and traditional NBFCs struggle to price the risk of commercial EVs. Unlike internal combustion engines, where residual values are well-understood, the battery—the most expensive component of an EV—is often viewed as a depreciating black box. This uncertainty freezes credit lines.
Turno attempts to solve this by turning the battery from a liability into a priced asset. The company operates as both a marketplace and a financing engine, distributing three-wheelers from OEMs like Mahindra, Piaggio, Omega Seiki Mobility, and Etrio. Its pitch to drivers relies on a few key pillars:
- Lower entry barriers: Underwriting loans with lower down payments and instant approvals.
- Asset management: A guaranteed buy-back value on used batteries, targeting 25–30% of the original cost.
- Lifecycle support: Managing the battery from first use to eventual repurposing.
By guaranteeing the residual value, Turno claims it can reduce the overall ownership cost by up to 30% compared to conventional financing options. For independent drivers operating on thin margins, that 30% is often the difference between sustainability and bankruptcy.
Financing as Infrastructure
This pre-Series B round follows a steady cadence of funding. Turno previously raised a $3.1 million seed round led by Stellaris in June 2022, followed by a $6 million Series A and a subsequent $13.8 million equity raise. With approximately $22.9 million raised prior to this injection, the company is capitalizing on a shift in investor sentiment.
The narrative in Indian VC circles is moving away from pure-play e-commerce delivery toward the infrastructure that enables it. With government mandates pushing for decarbonization in logistics, the demand for commercial EVs is rising. However, the lending infrastructure hasn’t kept pace.
Financing is the real infrastructure for commercial EVs. If you don’t fix financing, you don’t get fleets, and if you don’t get fleets, you don’t get real decarbonization.
The new funds are expected to extend Turno’s runway as it expands its physical footprint. Currently operating in Karnataka, Telangana, Tamil Nadu, Delhi NCR, and Maharashtra, the startup claims a significant market share in its active regions. The goal now is to prove that its credit book and battery economics hold up at a national scale, not just in early-adopter hubs.
Beyond the Three-Wheeler
While the humble auto-rickshaw remains the workhorse of Indian last-mile logistics, Turno’s ambitions are broadening. The company is preparing to enter larger vehicle categories, likely including light commercial vehicles and four-wheel cargo EVs.
This expansion brings Turno into direct competition with deep-pocketed incumbents. Large banks and captive finance arms like Mahindra Finance are waking up to the commercial EV opportunity. These players have access to a cheaper cost of capital than a startup ever will.
Turno’s bet is that vertical integration—owning the relationship from vehicle selection to battery resale—will allow it to price risk better than a generic lender. By controlling the data on how the vehicle is used and guaranteeing the asset’s end-of-life value, they hope to maintain a lower non-performing asset (NPA) rate than their peers.
It is a high-stakes play. The company effectively takes on long-term asset risk that others are avoiding. Success depends on their ability to accurately predict battery degradation and repurposing value years down the line.
If we can make it as easy to finance an EV as a smartphone, then you don’t just decarbonize; you change who gets to participate in the new logistics economy.
For the investors doubling down, the thesis is clear: Commercial EV financing isn’t just a niche; it’s a new asset class in India. Turno is positioning itself to define the rules of that class before the big banks can catch up.
