Over Rs 4,000 crore disbursed in supply chain finance to 2,500 MSMEs: udaanCapital

Credit and finance for MSMEs: udaanCapital caters to small buyers from Tier II, III and IV cities in India with its in-house digital underwriting capabilities.

Written by MSME Desk

February 15, 2023 16:49 IST

trade financing, udaan capital, udaan, b2b, ecommerce, digital lending, invoice finance, factoring, bill discounting, sme trade finance, digital loans, msme loans

The market for trade finance in the country is likely to grow at 7.1 per cent CAGR from $2.75 billion in 2022 $3.88 billion by 2027, according to data from market intelligence firm Research & Markets.

Credit and finance for MSMEs: UdaanCapital, the kirana and small retailer-focused trade financing arm of B2B e-commerce platform Udaan, on Wednesday said it has facilitated disbursals of more than Rs 4,000 crore in supply chain financing to over 2,500 MSME buyers in the last 24 months. The company, which caters to the working capital supply chain financing requirements of last-mile distributors and retailers of emerging and established brands, enabled these loans through over 100 brands it has partnered with via its supply chain financing programme.

udaanCapital caters to small buyers from Tier II, III and IV cities in India with its in-house digital underwriting capabilities. Chaitanya Adapa, Head – udaanCapital said, “Funding receivables and managing them is an industry-wide problem and we have witnessed strong demand from brands across mobile phones, consumer electronics, appliances, hardware, electricals and other categories for our program. We are glad to have been able to help our brand partners reduce and eliminate receivables and focus more of their energies on core business.”

Also read: M1xchange to help MSME exporters finance their invoices via new ITFS platform

According to the company, over a third of sales on Udaan is powered by udaanCapital. “udaanCapital, while partnering with brands to offer working capital finance to their distributors and dealers, has also started to cater to the financing requirements of the downstream retailers by facilitating the extension of credit limits up instantaneously,” it added.

Trade finance solution for small businesses in India assumes significance as the market for trade finance in the country is likely to grow at 7.1 per cent CAGR from $2.75 billion in 2022 to $3.88 billion by 2027, according to data from market intelligence firm Research & Markets.

Also read: Drip Capital and Vayana TradeXchange partner to provide export finance solution for SMEs

To solve the instant credit needs of MSMEs, the Reserve Bank of India’s trade financing platform TReDS is already in operation. According to an RBI report, the number of invoices uploaded and financed through TReDS had more than doubled to 17.33 lakh involving Rs 44,111.80 crore in the financial year 2021-22 and the success rate had improved to 94.7 per cent from 91.3 per cent a year earlier.