Shreyas Jani’s Post

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)

We’re seeing a significant shift towards fintechs focusing on unsecured small business loans, a sector that has been underserved for far too long. Large private sector banks are recognizing this potential and are increasingly collaborating with fintechs to serve this market. This shift has been influenced by recent regulatory actions and macroeconomic conditions, making unsecured consumer loans less attractive. The growth in digital lending to MSMEs is noteworthy, with a rise in transaction-led financing and flow-based credit offerings. This is a positive step towards fostering growth and financial inclusion in the MSME sector. #BFSI #fintech #digitallending #MSMEs #Benori

𝗙𝗶𝗻𝗧𝗲𝗰𝗵𝘀 𝘃𝘀. $𝟱𝟯𝟬 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗠𝗦𝗠𝗘 𝗰𝗿𝗲𝗱𝗶𝘁 𝗴𝗮𝗽: How are they making access to credit possible within 24-48 hours? Traditional lending often falls short, leading to a massive credit demand-supply mismatch leaving MSMEs with poor working capital reserves. 📉 Today 82% of SMEs are keen on sharing data with their banks for better services, along with 56% of SMEs shifting to digitally focused business models matching the increasing consumer demand. This has translated to a need for a next-gen credit decisioning for SMEs, as more than 50% of them need access to funds within 7 days. With FinTechs currently dominating the unsecured lending space, making access to credit within 24-48 hours is beyond any financial magic! Notably, the micro-segment with a credit exposure of less than INR 1 crore has registered a 23% YoY growth in originations value. Followed by consistent innovations behind platforms like Open Network For Digital Commerce (ONDC) & OCEN 4.0 led by innovators like Hrushikesh Mehta and organizations like ProductNation/iSPIRT, has further transformed the MSME lending ecosystem. From pre-to-post shipment financing, Fintech innovations have been amplified tremendously. Read More: https://bit.ly/3Y5lznk Think Working Capital, Think CredAble #MSMECredit #WorkingCapital #MSMEFinance #SMEFinance #TradeFinance #UnsecuredLending #FintechInnovation #CredAble

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

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

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

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

It's a truism that every fintech if it lives long enough will become a lender. But there has been no consensus on what kind of a lender. Lend form own book, or simply be a distributor or take the middle path and co-lend? If profitability is the ultimate measure of success, then a reading of the 2023 financials throws some answers. Of all the fintech lenders LendingKart stands out the most. It posted one of the biggest profits of Rs 119 crore (US$14 million) for the financial year of 2023-—an impressive swing from a loss of Rs 203 crore (US$24 million) in the previous fiscal. Gaurav Noronha's story answers why. https://lnkd.in/gVASRR7k

360Kredi Prepares To Anticipate Fintech Congested Credit And Upper Limit On Loans - VOI: Ahead of Eid al-Fitr 1445 Hijri, fintech platform P2P lending 360Kredi admitted that he would implement a number of anticipatory steps to reduce ...

Revolutionizing Credit: Fintechs Capture 52% Market Share in India's Lending Boom Experian India has unveiled a new white paper titled "Small is BIG: How Fintechs are Revolutionising Lending". The report highlights the rapidly growing role of fintech companies in providing small-ticket loans to underserved segments of the population, demonstrating how technology is revolutionizing the lending landscape in India. Read More https://lnkd.in/d2gkA7QE