Credit and finance for MSMEs: MSME lender U GRO Capital on Monday launched its new app GRO X for micro and small merchants to get collateral-free instant working capital loans through unified payments interface (UPI). “Merchants can get Rs 25,000 to Rs 2 lakh instant credit. It (app) is likely India’s first SME credit platform on UPI,” Shachindra Nath, Vice Chairman and Managing Director, U GRO Capital told FE Aspire.
For example, a grocery owner can get credit through GRO X instantly to stock up his store, pay his distributors, receive payments from customers as well, check his credit limit and debit and credit transactions, and also repay the loan.
“We realised that the challenge for micro enterprises such as a retail shop or a small manufacturer is that most of the time the credit products available in the market are tenured from let’s say three months to a few years in comparison to the credit need for a very short period and instant. So we created this app to dispense credit through UPI,” Nath said.
The loan processing time on the app would be 5-7 minutes and the rate of interest would be around 15-18 per cent, according to Nath. GRO X would be available for both existing and new borrowers.
Also read: Step-by-step guide: How to register your MSME on Udyam portal for free
U GRO said it aims to acquire and service over 1 million MSME customers in the next three years on the GRO X app as part of its vision to achieve assets under management (AUM) of Rs 20,000 crore and capture 1 per cent market share in the MSME lending space by 2025. The company also released its first brand campaign on Monday to highlight underwriting and instant loan solutions for last-mile MSMEs.
Nath said the company’s loan book stood at nearly Rs 6,300 crore at the end of FY23 vis-a-vis Rs 5,095 crore during Q3. UGRO had disbursed Rs 1,874 crore in loans while its profit after tax (PAT) stood at Rs 13.1 crore as of Q3. Net NPAs, on the other hand, were 1.1 per cent of AUM.