CredAble’s Post

Please read our CEO's news on Mint regarding Fintechs and NBFCs can solve credit issues for SMEs and MSMEs. https://lnkd.in/gT-2ekHU #nbfc #fintech #SMEs #MSMEs Vikas Singh Brajmohan Singh

MSME Fintechs Emerge as New Champions in Digital Lending Landscape!! 🙌🏻 Here’s an overview of what’s up in the industry! Shift in Focus: Digital lending is transitioning from consumer credit to spotlighting business-focused fintech lenders like Indifi, Lendingkart, Aye Finance, and Kinara Capital. Increased Collaboration: Major private sector banks are partnering with fintechs to tap into the unsecured business credit market, especially for MSME loans. Regulatory and Economic Influences: Recent regulatory actions and macroeconomic changes have made unsecured consumer loans less appealing, pushing lenders towards MSME lending. Growth in Digital Lending for MSMEs: Fintechs have seen a surge in MSME loans, with significant loan volumes sourced in the sub-Rs 1 lakh business loans category, highlighting the growing digital influence in this sector. Market Size and Potential: Despite the focus shift, business lending remains smaller than consumer lending, indicating significant growth potential. Regulatory Changes Boosting MSME Lending: Adjustments like increased risk weightage on unsecured consumer lending are redirecting lenders' focus towards MSMEs. Challenges and Opportunities: Teething issues like physical KYC requirements present operational challenges, while digital sales platforms for small businesses offer new opportunities for digital lending. Financial Health of Fintechs: Improved financials among MSME-focused fintechs are attracting traditional lenders for co-lending partnerships, highlighting a positive trend towards healthier fintech ecosystems. #fintech #fintechnews #msme

𝗙𝗶𝗻𝘁𝗲𝗰𝗵𝘀 𝗣𝗶𝘃𝗼𝘁 𝘁𝗼 𝗠𝗦𝗠𝗘 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴 🚀 (𝘔𝘪𝘤𝘳𝘰, 𝘚𝘮𝘢𝘭𝘭 & 𝘔𝘦𝘥𝘪𝘶𝘮 𝘌𝘯𝘵𝘦𝘳𝘱𝘳𝘪𝘴𝘦𝘴) 𝗜𝗻𝗱𝘂𝘀𝘁𝗿𝘆 𝗟𝗮𝗻𝗱𝘀𝗰𝗮𝗽𝗲 𝗦𝗵𝗶𝗳𝘁 💼 Regulatory actions and macroeconomic changes are steering digital lenders away from unsecured consumer loans towards unsecured small business loans. 𝗘𝗺𝗲𝗿𝗴𝗲𝗻𝗰𝗲 𝗼𝗳 𝗗𝗶𝗴𝗶𝘁𝗮𝗹 𝗟𝗲𝗻𝗱𝗲𝗿𝘀 𝗶𝗻 𝗠𝗦𝗠𝗘 𝗦𝗽𝗮𝗰𝗲 💡 Industry leaders like Indifi, Lendingkart, Aye Finance Pvt. Ltd & Kinara Capital are capitalizing on this shift, with an increasing focus on MSME loans traditionally dominated by banks and NBFCs. 𝗖𝗼𝗹𝗹𝗮𝗯𝗼𝗿𝗮𝘁𝗶𝗼𝗻 𝘄𝗶𝘁𝗵 𝗣𝗿𝗶𝘃𝗮𝘁𝗲 𝗦𝗲𝗰𝘁𝗼𝗿 𝗕𝗮𝗻𝗸𝘀 🤝 Large private sector banks are recognizing the potential of partnering with digital lenders to tap into the underserved unsecured business credit market. 𝗦𝗶𝗺𝗽𝗹𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗠𝗦𝗠𝗘 𝗥𝗲𝗴𝗶𝘀𝘁𝗿𝗮𝘁𝗶𝗼𝗻 🖥️ The government's Udyam Registration Portal simplifies MSME registration, enabling easier classification of entities for priority sector lending by banks. 𝗜𝗺𝗽𝗿𝗼𝘃𝗲𝗺𝗲𝗻𝘁 𝗶𝗻 𝗗𝗲𝗹𝗶𝗻𝗾𝘂𝗲𝗻𝗰𝘆 𝗥𝗮𝘁𝗲𝘀 🔍 Delinquency rates in the MSME segment have witnessed a notable decline over the last three years, further incentivizing lenders to focus on this space. 𝗗𝗶𝘃𝗲𝗿𝘀𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗠𝗦𝗠𝗘 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴 💸 MSME lending by fintechs has diversified beyond unsecured business loans to include supply chain financing and invoice-based financing, reflecting the evolving needs of the sector. 𝗖𝗵𝗮𝗹𝗹𝗲𝗻𝗴𝗲𝘀 𝗶𝗻 𝗗𝗶𝗴𝗶𝘁𝗮𝗹 𝗟𝗲𝗻𝗱𝗶𝗻𝗴 🛡️ Challenges such as physical KYC requirements pose operational hurdles and costs for digital lenders, highlighting the need for streamlined processes and digital infrastructure improvements. 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗥𝗲𝘀𝗶𝗹𝗶𝗲𝗻𝗰𝗲 𝗼𝗳 𝗙𝗶𝗻𝘁𝗲𝗰𝗵𝘀 💰 Fintechs are showing improved financial performance, attracting traditional lenders for co-lending partnerships. 𝗚𝗼𝘃𝗲𝗿𝗻𝗺𝗲𝗻𝘁 𝗦𝘂𝗽𝗽𝗼𝗿𝘁 🏦 Government credit guarantee schemes protect lenders from non-performing assets, fostering a conducive environment for collaboration between traditional lenders and fintechs. In 𝗰𝗼𝗻𝗰𝗹𝘂𝘀𝗶𝗼𝗻, the evolving MSME financing landscape offers challenges and opportunities for digital lenders. Navigating regulatory changes and operational hurdles, partnerships with traditional institutions and government support are key in fostering inclusive growth. 🌱 #msme #lending #fintech source: https://lnkd.in/gYNyuvuB (views expressed are my own)

Check out latest blog on "Leveraging Lending Technology for MSMEs in India: Overcoming Credit Delivery Challenges." In this article, we delve into the game-changing innovations that are reshaping the credit landscape for Micro, Small, and Medium Enterprises in India. Click the link below to explore the future of MSME financing and how technology is paving the way for growth and sustainability. Feel free to share your thoughts in the comments, and let's spark a conversation around empowering MSMEs through cutting-edge lending solutions! #msme #LendingTechnology #fintechnews #AllCloud

The Open Network for Digital Commerce is bridging the MSME credit gap by providing a digital platform that connects MSMEs with lenders.   By streamlining the lending process and facilitating easier access to credit, ONDC empowers MSMEs to overcome traditional barriers such as lack of collateral or credit history. This fosters financial inclusion and supports the growth of MSMEs in India's economy. Keep reading to learn more about ONDC: https://bit.ly/3VjJBJH #Finverv #ONDC #MSMEs #Banking #Finance #CreditGap #Liquidity #Fintech

Rajat Deshpande FinBox examines digital nano-loans as a tool for financial inclusion. "CRIF’s CreditScape report of September 2022 stated that there were 4.77 crore small ticket personal loans (STPL), worth INR 30,228 crore. The ticket size mix in the same report indicated over 75% of STPLs comprised loan sizes less than INR 10,000—and most of these loans had a tenure of less than 3 months. These STPLs have another interesting feature: the majority of them originate from NBFC fintechs. Could it be, then, that the adoption of technology by lending institutions has contributed significantly to the rise in nano loans? I’m convinced that this is the case." https://lnkd.in/ga5iUXMJ

Fintech NBFCs are revolutionising the personal loan market! Recent data shows a significant shift in the risk profiles and portfolio quality of Fintech NBFCs offering personal loans. Here are some key highlights: 📉 Reduction in High-Risk Borrowers: The share of very high-risk borrowers has decreased. Meanwhile, mid-to-low-risk borrowers now make up 58% of the portfolio, up from 36%. 📊 Improved Portfolio Quality: Since March 2021, the dpd has decreased, showcasing enhanced risk management and customer assessment. 💸 Smaller Ticket Size Loans: The share of loans below ₹25,000 has decreased. However, the average ticket size remains around ₹11,000 due to a higher volume of small-ticket loans. 🔄 Shifting Towards Better Loan Quality: Digital personal loans from Fintech NBFCs now account for 65% of the total loan sanction volume, indicating a shift towards more robust and quality lending practices. These changes reflect the fintech sector's improving risk management and better loan quality. It’s an exciting time for the industry as it continues to evolve and cater to a more diverse range of borrowers. ♻️ If you found this post insightful, consider resharing it. #Fintech #PersonalLoans #Finance #NBFC #LoanQuality #RiskManagement #FintechRevolution

How Fintech is Disrupting Credit Bureaus? 👇 Read the insightful article link below on Credit Bureaus need to reinvent and had my perspective with a real case study Key Points: 〰️Rapid Growth in Unsecured Loans:The number of unsecured personal loans surged, driven by fintech companies like Lending Club and Prosper. 〰️Consumers used these loans to refinance credit card debt, benefiting from lower interest rates and improved credit scores. 〰️Impact on Credit Scores:Although credit scores increased, they often didn’t reflect a lower credit risk. Consumers continued to accumulate debt.FICO adjusted its scoring algorithm to address this, impacting millions of Americans' credit scores. 〰️The emergence of BNPL and Credit Builder Cards:BNPL (Buy Now Pay Later) and credit builder cards are new fintech innovations disrupting traditional lending.BNPL allows consumers to split payments into installments without interest, primarily used for small purchases. Credit builder cards help consumers build credit without substantial credit risk. 〰️Challenges for Credit Bureaus:Credit bureaus struggle to categorize new fintech products like BNPL and credit builder cards.Different bureaus are taking varied approaches to include these products in credit files, creating inconsistency. 〰️Need for Adaptation:Credit bureaus need to integrate new tradeline types to keep up with fintech innovations. Failing to adapt could lead to a shift towards alternative credit decisioning methods based on deposit transaction data, potentially disrupting traditional credit infrastructures. ------- 〰️My Perspective: The rapid growth and innovation in fintech are reshaping the landscape of credit and lending. India is a great example where small business owners are now taking advantage of emerging fintech/financial products—Bajaj Finance is an epic example. They have their data, and now with the success of UPI, they have granular-level transactional data. While this brings numerous benefits to consumers, it also poses significant challenges to traditional credit scoring systems. The need for credit bureaus to adapt and integrate new types of financial products is critical for maintaining an accurate and fair credit assessment system. As fintech continues to evolve, staying informed and adaptable is essential for both consumers and financial institutions. PS: What are your thoughts on this topic? 🙏 Shivendra Bhatia 🌏 #fintech #finance #innovation

KreditBee fuels expansion with a $9.4M boost in his Series D funding round #KreditBee, the digital lending platform known for its innovative approach to connecting borrowers with non-banking financial companies (NBFCs) and banks, has just taken a significant leap forward. The company announced a successful $9.4 million extension to its Series D funding, earmarking a new chapter in its journey to redefine digital lending in the #fintech market. The recent funding round saw a consortium of existing investors reaffirming their confidence in KreditBee's mission and potential. Prominent names such as Premji Invest, Motilal Oswal Financial Services Ltd Private Equity, and Mirae Asset Global Investments led the charge, with Wiseanya spearheading the funding efforts. Other noteworthy contributors include MUFG Bank and NewQuest Capital Inc., further bolstering KreditBee's financial and strategic backbone. KreditBee, founded by Madhusudan E, has carved out a niche by focusing on young professionals, offering personal loans up to $5,200 with flexible repayment terms ranging from 2 to 15 months. The competitive interest rates, capped at 2.49%, underscore KreditBee's commitment to affordability and accessibility. This targeted approach has made KreditBee a go-to platform for its demographic, enabling them to meet their financial needs with ease and convenience. With the fresh injection of capital, KreditBee is set to accelerate its operations, broaden its product suite, and continue leading the charge in digital lending innovation. The funds will enable KreditBee to enhance its service offerings, ensuring that it remains at the forefront of the financial technology revolution. The article on FinTech Global in the first comment. Want to stay up to date with the market? Here my newsletter: - Linkedin: https://t.ly/s541W   - Substack: https://lnkd.in/dzfGJzmW

BankiFi Partners With Praetura to Expand Small Business Funding Access in UK: FinTech BankiFi has partnered with financier Praetura to develop a lending-as-a-service solution for small to medium-sized enterprises (SMEs) in the U.K. The platform is specifically designed to help SMEs access growth funding, even if they do not meet the requirements of traditional banks, according to a Wednesday (Feb. 21) news release on The Business Desk. Through BankiFi’s technology platform, […] The post BankiFi Partners With Praetura to Expand Small Business Funding Access in UK appeared first on PYMNTS.com. #opnplatform #b2bpayments #openpackagingnet