When Naresh Gupta, of Banaras ran pillar to post looking for a bank loan, he realised that it was easier to either sell off his assets or trade away aspirations to expand his business than get a loan to do so. Bereft of hope and access to capital, Naresh is the story of thousands of other such retailers, and small business owners who need capital to fund their business expansion plans.
While a lot of such expansion plans get thwart because of lack of capital and loans, not all the declined loans are due to ineligibility of the borrowers. The banks have been overworked, depending mainly on bank staff to conduct the complete financials verification, reference check, documentation validation, disbursal and finally loan recovery. Such human-intensive process makes it a herculean task for banks to be able to do justice to all its customers. In rural India lack of documentation, bank accounts or collateral also lead to loan application rejection.
However, giving relief to borrowers and lenders alike, a new stream of technology-based financial services, fintech has emerged. The fintech has digitalised banking, loans, and customer profiling in the credit industry, along with many innovations and automation in the financial services sector at large.
Clearly, this category is no passing fad but rather a game-changer for micro- and small- and medium-sized businesses (SMBs). While these businesses previously struggled due to the lack of support from traditional banks, they’ve found affordable solutions from fintech platforms. For one, platform-driven reach has helped banks grow about 15 to 20 percent indicating that banks’ dependence on `feet-on-street’ to campaign for loans may recede in a few years.
Taking financial tech platform to the last mile – Pragati Capital will help small businesses to get loans in smooth and hassle-free digital procedure in lesser time.
The Pragati platform will enable the retailer to apply for a loan directly through the app. The online /app based loan application reduces paperwork, chances of incorrect entries and delays. The borrower has to upload all documents via their phone by simply clicking a snap of the documents and uploading them on the app.
Pragati Capital via the Pay1 platform provides working capital and business loans to the Pay1 networked retailers. The loan disbursal criteria are the business volume, consistency and general credit score, maintained by the Pay1 data analytics. The loan disbursal turnaround time of 48 hours, hassle-free KYC approvals, weekend loans, and low-interest rates make Pragati a preferred lender among a huge section of unorganised and organized retailers.
Pragati also provides additional services and revenue schemes for the retailers like empowering them to sell credit products like insurance and mutual funds to customers and earning attractive commissions on the business and lead generation. The insurance gamut extends covers like personal accident, motor vehicle accident, travel, dengue and cancer cover.
Such platforms enable low risks loans at competitive interest rates, reduce the time for disbursal and reduce the chances of bad loans. The platform offers unmatched speed, and convenience and the overall lending requirements (e.g., credit score levels) which are less restrictive than multinational banks.
Banks and NBFCs using fintech capabilities of the retail platforms can take better credit decisions and get higher conversion in disbursal of loans.
Thus Pragati Capital, via the using the Pay1 retail network is focused towards making financial independence among retailers and small business owners a real possibility.