Credit and financing for MSMEs: FlexiLoans said it was the first lender to go live on the Google Pay platform. The company said it has disbursed unsecured business loans worth over Rs 1,000 crore over the past four years and has access to over 5 million MSMEs in the country.
Credit and financing for MSMEs: Google’s payment app for small businesses, others – Google Pay for Business has now given small merchants access to credit through its link to the digital MSME lending platform FlexiLoans. The latter also plans to disburse loans to more than 50,000 small businesses over the next 12 months with this collaboration. Loans to the majority of MSMEs in several sectors have been severely affected due to the pandemic and subsequent shutdowns. Importantly, credit extended by banks to micro and small enterprises (MSEs) in April this year had recorded negative year-on-year growth of minus 2.2% for the first time since Covid hit last year, the latest data from the Reserve Bank of India showed. Banks had rolled out Rs 10.60 lakh crore in April, up from Rs 10.84 lakh crore in April 2020.
“Merchant lending via Google Pay for Business has launched with Flexiloans. We will be adding more partners to the list in the coming months… In addition to payments, Google Pay for Business merchants can create online stores, manage the register customer balances and earn credits with just a few clicks,” Google Pay told Financial Express Online in a statement.
FlexiLoans said it was the first lender to go live on the Google Pay platform. The company said it has disbursed unsecured business loans worth over Rs 1,000 crore over the past four years and has access to over 5 million MSMEs in the country. Loan requests come largely from Levels III and IV. FlexiLoans has targeted an annualized disbursement rate of over Rs 1,000 crore in a single year. “The timing (of the collaboration) is also the right one given the difficulties this sector has faced during the pandemic. Google Pay is at the forefront of merchant payments and we hope to provide every Google Pay merchant with a secure and digital borrowing experience,” said Abhishek Kothari, co-founder of FlexiLoans.com.
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According to World Bank estimates, the credit gap for Indian MSMEs is $380 billion and the digital or online lending market. The value of digital loans in India had reached the $75 billion mark in 2018 and by 2023, the value of digital loans is expected to rise to around $350 billion, according to Statista. FlexiLoans competes with Lendingkart, Indifi, Ziploan, BharatPe, Razorpay, etc.
In a bid to ease the credit crunch among Covid-affected MSMEs, the government had last week upgraded the Emergency Credit Line Guarantee Scheme (ECLGS) corpus to Rs 4.5 lakh crore from Rs 3 lakh crore earlier under the Rs 20 lakh crore Atmanirbhar Bharat package announced last year in May.
Google had announced earlier this year that it would invest $15 million to support SMEs in India for which it is in discussions with local partners. The search giant had announced a $200 million investment as part of its more than $800 million commitment to support small businesses around the world amid Covid. The company also launched Grow with Google Small Business Hub last year to offer digital tools to small businesses for digital adoption “go digital, maintain business continuity, and access helpful resources like quick help videos. , support pages for learning digital skills”. Google had said last year.
This story has been updated with comments from Google Pay.
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