BharatPe not only leads aid to MSMEs but also pioneers a unique repayment scheme

Micro, Small, and Medium Enterprises (MSMEs) are the foundations on which the Indian economy is based. Providing livelihood via business or job to countless Indians, especially in smaller cities and villages, the MSMEs contribute about 45% of the manufacturing output, 40% of the exports and 8% to the country’s Gross Domestic Product (GDP).

The pandemic COVID-19 has struck at the roots of consumption and livelihoods. Except a few sectors and industries, all are in a recession-like state. Private businesses are the hardest hit. And so are the current and upcoming MSMEs.

 To compound the difficulties, banks and especially the public banks, are saddled with mountains of Non-Performing Assets (NPA) which understandably does not make them too willing to go out of their way to offer loans to aspiring MSMEs. The banks can always ask for collateral, but if the entrepreneur was already that well-off, they may not have required the loan in the first place.

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Answering to these needs, privately-backed financial and technology companies like BharatPe are coming forward to help finance MSMEs. The company has also left behind its competitors by having loaned out Rs 150 crore in the current quarter, of which Rs 80 crore was in the month of September only. Not the one to sit on its laurels, the company has announced its aim to disburse Rs 1000 crore till the end of financial year 2021.

Lender-friendly measure like no requirements of any collateral helps aspirants at the bottom of the financial hierarchy. Also, a new product ‘BharatLoan’ has no human contact for creditworthy businesses with a fully automated digital process allowing for a faster fulfillment of finance needs. The pioneering technique by the company is the option of bite-sized daily repayment of the loan. In addition to these daily payments, a larger-sized weekly payment can also be made.

 The company serves across 35 cities and serves over 50 lakh merchants. The company is funded by private venture capitalists namely Amplo, Insight Partners, Beenext, Sequoia, Ribbit Capital, Coatue, and Steadview Capital Management.