How litigation financing is modernizing the pursuit of justice
As we step into 2025, it’s worth reflecting on the transformative impact litigation financing had on India’s legal landscape in 2024. The past year witnessed a surge in business-to-business (B2B) disputes, driven by economic uncertainties and increased commercial activity. Issues such as non-payment of invoices, contractual breaches, and supply chain disruptions were rampant, putting immense pressure on businesses, especially small and medium enterprises (SMEs).
In this challenging environment, litigation financing emerged as a crucial enabler, helping businesses pursue justice without the financial burdens that often deter them from legal action. Beyond financial support, litigation financiers redefined how disputes are managed and resolved, setting a new benchmark in the legal ecosystem, writes Tanya Prasad, Chief Investment Officer, Legalpay.
The wave of B2B disputes in 2024 underscored the importance of accessible legal recourse. Many SMEs, constrained by limited resources, found themselves at a disadvantage in pursuing their claims. Litigation financing bridged this gap by offering not only funding but also strategic support, empowering businesses to tackle disputes head-on. By supporting over 1,200 cases in 2024, litigation financing providers demonstrated their commitment to leveling the playing field for businesses of all sizes, ensuring that justice was no longer a privilege but a right accessible to all.
One of the defining features of litigation financing in 2024 was its evolution into a comprehensive service. Beyond covering legal costs, providers offered end-to-end case management, including access to expert legal counsel, tailored strategies, and efficient resolution mechanisms. This holistic approach allowed businesses to focus on their core operations while entrusting legal complexities to seasoned professionals, significantly enhancing the efficiency of dispute resolution.
2024 was also a landmark year for Alternative Dispute Resolution (ADR) and Online Dispute Resolution (ODR). These methods accounted for the resolution of nearly 60% of cases funded by litigation financiers, highlighting their growing acceptance as cost-effective and time-efficient alternatives to traditional litigation. This shift not only reduced the financial and emotional burden on disputing parties but also alleviated pressure on India’s overburdened judiciary, contributing to a more efficient legal system.
Mediation gained significant traction in 2024, particularly Pre-Institution Mediation and Settlement (PIMs). Providers expanded their presence across major commercial hubs like the National Capital Region (NCR), Bangalore, and Mumbai, as well as regions like Punjab, Kerala, and Bihar. This nationwide reach brought mediation closer to businesses across India, fostering a culture of resolution that emphasized collaboration over contention.
Litigation financing proved especially impactful in sectors such as fintech, warehousing and logistics, and e-commerce and retail. Tailored solutions addressed challenges like payment delays, supply chain disruptions, and contractual breaches, reinforcing litigation financiers’ role as trusted partners in navigating industry-specific challenges. These efforts ensured that businesses could overcome obstacles and continue to thrive.
2024 also saw the expansion of litigation financing into defense-side funding. Businesses and individuals facing cases in forums like the National Company Law Tribunal (NCLT), Debt Recovery Tribunal (DRT), and consumer courts benefitted from this support. This diversification highlighted the sector’s commitment to ensuring equitable access to justice, regardless of a party’s position in a dispute.
Reflecting on 2024, it is evident that litigation financing has fundamentally reshaped India’s dispute resolution landscape. By democratizing access to justice, fostering alternative resolution mechanisms, and alleviating financial barriers, it has empowered businesses and reduced systemic inefficiencies. As we move forward in 2025, litigation financing is poised to build on the successes of the past year. Its continued evolution will undoubtedly play a pivotal role in strengthening India’s legal framework and ensuring that justice remains within reach for all.
