Untapped Capital Starvation in Indian MSME Sector a Great Boon for FinTech Startups

#sme #msme #capital #founders #startupindia #startupbharat #aatmanirbharbharat #fintech

With my more than 20 years experience in dealing with thousands of MSME businesses, the reason I have seen for their failure is not lack of talent, market, labour or technology, but starvation due to lack of access to timely and adequate capital.

So FinTech startups in India have huge unimaginable potential and also can do immense yeoman service to our country just by channelising savings and providing timely and adequate finance to MSME sector.

All the best!

Startup Strategy: Santander's Asto offers loans to SMEs on Funding Options

#MSME #SME #lendingsolutions #lending #credit #fintech #startups #startupstrategy

Santander’s invoice and expenses app, Asto, has partnered with alternative UK lender, Funding Options, to offer business capital loans to early-stage start-ups and small and medium-sized enterprises (SMEs).

Funding Option’s CEO, Simon Cureton, calls Asto “one of a new breed of ambitious and innovative lenders laser-focused on providing truly flexible finance solutions for businesses”.

Key takeaway:

Partnering with e-commerce giants would give lending company a better access to financial strength of the sellers on these platforms.

The above fintech venture broke into lending last year when it partnered with eBay to off loans to the 200,000 UK SMEs which sell their products through the ecommerce giant’s platform.

The app connects to eBay’s data to measure sales and cash flow to identify prospective customers and shape its credit decisioning process.

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Santander's Asto offers loans to SMEs on Funding Options - FinTech Futures

Asto, Santander's fintech app, has partnered with alternative UK lender Funding Options to offer business capital loans to early-stage start-ups and SMEs.

Startup Ideas: The biggest problem of late payments faced by Indian MSMEs can be turned into an opportunity

#starupideas #startupindia #msmesector #fintech #MSME #hugeopportunity #covid19

Payment delays have for long been a huge problem for India Inc. An EY report in 2018 estimated that Rs 1.8 lakh crore was trapped as receivables. But it is the medium, small and micro enterprises (MSMEs) who feel the pinch the most. Media reports estimate that large corporations owe Rs 40,000 crore and PSUs Rs 48, 000 crore to MSMEs.

According to a recent report by Zinnov, India has over 75 million small and medium businesses that contribute 40% to the gross domestic product, employ 180 million people and contribute 52% of India’s $535 billion exports. Yet, with limited financial means, MSMEs often swing between life and death. Due to corona virus effect, many MSMEs may shut down shops and others either may become bankrupt or continue to work at a lower capacity than that in pre-covid times.

“The whole concept of slow payments is a huge global issue,” Previse co-founder and CEO Paul Christensen tells Forbes in an interview. “It is a huge global opportunity that no-one has cracked yet. Given the problem is so big, why has no-one cracked it yet? Everyone has tried to solve the problem using process, and changing process at large organisations is really hard.”

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Choked by dues: What efforts are being taken to ease the biggest problem faced by Indian MSMEs?

Haggling is an art. Bengaluru-based Amarpreet Kalkat, 41, cofounder of Frrole - a social intelligence startup - is trying to master it these days. The six-year-old startup has 40-plus customers, mostly mid-to-large firms in media and consumer businesses. Recently, one of them refused to pay his subscription dues of six months.