Proprietor Loans aim to reduce documentation and the time taken to avail a loan in comparison to traditional banking services.
The product targets the small retailer segment like salons, medical stores, kirana, mobile phone retailers, small restaurants, etc. who face challenges in obtaining loans for business expansion from traditional lenders.
"Our tradition of being pioneers of digital lending in India continues, as we've created an entirely paperless process through the app and achieved low unit economics to penetrate a vast market that was untapped. We've ensured that the customer experience remains top notch, as the borrower receives the loan in minutes by providing their Aadhar number," said Sashank Rishyasringa, co-founder, Capital Float.
"We're currently adding 2,000 borrowers a month and expect to reach 5,000 borrowers per month by March 2018," he added.
There are above 5 million kirana stores in India which are run by micro-entrepreneurs with business ambitions such as increasing product lines, diversification, digitization or opening more stores. However, they don't have quick and easy access to funds.
Capital Float will assist the micro-entrepreneurs by providing loans between Rs. 25,000 to Rs. 5 lakhs with convenient repayment options ranging from three to six months.
Additionally, Capital Float will also provide loan enhancements, top-ups and renewals based on the business performance of the borrower. Capital Float has partnered with various ecosystem leaders such as Amazon Business, Metro Cash & Carry, Storeking, Payworld and PayTM.
Operations are currently live in all the metros, while the team is focussing on taking the product to Ahmedabad, Surat, Chandigarh, Bhopal, Indore and Vizag.
"Getting loans is always a challenge for small retailers in India due to complex documentation, time-consuming procedures and traditional approach to underwriting. Through proprietor loans, we aim to support these micro-entrepreneurs to achieve their business aspirations," said Gaurav Hinduja, co-founder, Capital Float.
"Our loan product will help our borrowers grow their business, while our partners experience larger volumes of transactions on their respective platforms. We're currently offering term loans and lines of credit to our borrowers," added Hinduja.
"By launching the proprietor loan product, Capital Float continues to be at the forefront of financial innovation in India. With this credit solution, they will be catering to a vast market of under-served micro-entrepreneurs in the country. Through our collaboration with Capital Float, we expect our customers to experience exponential growth on our platform, consequently increasing the volume of transactions on Payworld," said Praveen Dhabhai, COO, Payworld.
"I'm confident the digitizing of the fintech and lending sector through the approach of Capital Float will transform the landscape of financing. Small traders and business owners in the last year have really embraced their smartphone effectively and the seamless user experience of Capital Float has provided an enhanced customer experience through the app," said Sumat Chopra, Director, Value Creation at Metro AG.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)