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Muthoot Finance and fintech startup Rupifi to help 15 million small and medium-sized businesses get instant credit


Access to credit has been one of the biggest challenges for MSMEs in the country, as banks have been cautious in providing loans to MSMEs considered risky.

Credit and financing for MSMEs: Business-to-business digital payments startup for small and medium-sized enterprises (SMEs) Rupifi on Tuesday announced a partnership with non-bank finance company Muthoot Finance to help 15 million SMEs access instant credit over the next few years. Launched in January 2020, Rupifi allows SMEs to flexibly reimburse their contributions as and when needed with an interest rate per day but without any monthly IME. Through the merger, the startup said it is looking to grow its SME portfolio over the next few years.

“We have been at the forefront of providing frictionless and cash flow linked credit to MSMEs over the past 12 months. We are currently working with B2B marketplaces in the areas of FMCG, Pharma, Fashion, Agriculture and Food, offering SMEs that transact on these platforms instant credit for their purchases. We have SMB clients in over 230 small towns across the country and have analyzed over a million data points over the past few months to create a robust cash flow-based underwriting framework, ”said Rupifi co-founder and CEO Anubhav Jain in a statement.

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Most of these small businesses today don’t get unsecured credit from banks, NBFCs or even fintechs, so they have to rely on secured loans to manage their working capital, he added. “Indian SMEs are going through a difficult phase, especially post-covid. At Muthoot Finance, we develop products and lead various initiatives to provide them with working capital support. Rupifi has built a strong integrated B2B infrastructure and ‘Buy Now Pay Later’ (BNPL) is the hot item for Indian SMEs, particularly driven by the increasing post-covid digitization, ”said Jayachandran B, director of the operation – Business loans, Muthoot Finance.

Access to credit has been one of the biggest challenges for MSMEs in the country, as banks have been cautious in providing loans to MSMEs considered risky. However, the government had put in place several credit guarantee programs to encourage banks to lend more to MSMEs. According to RBI data, banks had deployed Rs 11.10 lakh crore to micro and small businesses in August 2021, up only 1.1% from Rs 10.98 lakh crore in August 2020. In addition, in FY21, loans to MSMEs registered almost 52%. jump in value. From 16.2% in FY2017, the value of MSME loans in commercial loans increased to 24.6% in FY21, credit bureau CRIF High Mark said in its report. How India Lnds 2021 in September.

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Cory E. Barnes

The author Cory E. Barnes

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