7 June 2023, Bengaluru, India
According to official statistics, the Department for Promotion of Industry and Internal Trade (DPIIT) has officially recognized 92,683 entities as startups as of February 28, 2023, since the launch of the Startup India project.
These companies have played a significant role in showcasing cutting-edge products that utilize technology, developing FMCG (Fast Moving Consumer Goods) goods that are health-focused, and developing thoroughly thought-out ideas to simplify daily tasks.
Startups must invest their first capital, just like any company, and further funds are frequently needed to keep up with growth or expand operations to fresh, more remote places. These businesses’ founders frequently explore innovative methods of raising capital because they depend on it to grow swiftly.
Some people still bootstrap their businesses through conventional forms of financing, even though many people now choose venture capitalists as a source of investment.
According to Balaji Jagannathan, Co-Founder & Director at Paycorp.io, fintech lending, which uses technology and digital solutions to streamline the loan application and repayment process, has developed into a significant resource for startups looking to bootstrap their businesses rather than seeking funding from venture capitalists.
The ideal method for ensuring on-time payments has since evolved into recurring auto-debit systems. By automatically deducting the installment amount on the due date, these techniques aid in avoiding late fee expenses.
The creators of Paycorp.io continued by talking about Single Block Multiple Debit, another innovative digital payment mechanism that can be accessed via the Unified Payments Interface (UPI) and allows borrowers to reserve the correct payment amount to be deducted on the due date.
CEO of NBFC-MFI Muthoot Microfin Sadaf Sayeed claims that fintech may improve the loan repayment process for both borrowers and lenders, improving business creditworthiness and fostering growth.
The Indian microfinance industry is anticipated to grow at a CAGR of 11.3% between 2022 and 2028. Sayeed asserts that the rise of microfinance institutions, which is essential for reducing poverty and raising the standard of living for impoverished populations in developing nations, is primarily responsible for this massive growth.
This startup finance issue can be resolved by collaborations with fintech firms. These forward-thinking financial technology firms have had a significant impact, attracting investments at previously unheard-of levels, and they can help credit-starved Indian entrepreneurs. The procedure for traditional funding choices has been improved by the technology-based analytics used by fintech firms, making it simpler for entrepreneurs to obtain loans and credit lines, according to Khanna.
According to Gaurav Rastogi, the founder, and CEO of Kuvera, India has about 190 million unbanked people who are not eligible for traditional financial services.
India is one of the most appealing locations for investments worldwide because of its relatively low penetration of financial products and services and rapid adoption of fintech, the author continued.
[Source:livemint.com]
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