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NeoGrowth has received exclusive coverage in CNBC TV18 online for the authored article titled, “New age lending practices can support Indian MSMEs to shift into formal sector”, by our CEO, Mr. Arun Nayyar.
Summary : India has approximately 6.3 crore MSMEs, which contribute about 30% of the country’s GDP. In spite of these optimistic figures, timely access to funding remains a critical impediment to the growth of micro and small companies in India. India’s MSME credit shortfall is ~Rs 25.8 trillion (USD 397 billion). Almost 95% of the addressable credit demand comes from micro and small enterprises. Many MSMEs borrow from informal sources such as local money lenders for their cash requirements, at exorbitant rates of interest. In this article, Mr. Nayyar discusses how new age lending practices like cash flow-based lending, analysis of bank statements and collateral free lending can bridge the existing MSME credit gap and promote inclusion of MSMEs in the formal sector.
