MSME lender U GRO Capital eyes Rs 20,000 crore AUM by 2025 to address small business credit gap

By Sandeep Soni8 days ago

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Credit and Finance for MSMEs: U GRO is looking to acquire a 1 per cent market share of the SME lending market by 2025 which translates to around Rs 20,000-crore asset under management.

According to the World Bank estimates, the MSME credit gap is at $380 billion (around Rs 28.34 lakh crore).

Credit and Finance for MSMEs: Owing to the pandemic, banks have become averse to issuing credit card facilities to MSMEs even as there is a need by such enterprises for credit cards to pay for employee salaries, buy goods, manage working capital, etc., according to Shachindra Nath, Executive Chairman and Managing Director at small business lending fintech platform U GRO Capital. The company on Thursday had announced an MSME-focused co-branded credit card solution in partnership with SBM Bank India, a step-down subsidiary of SBM Holdings (erstwhile State Bank of Mauritius), powered by RuPay and EnKash.

As per our internal study, U GRO Capitals 50 per cent SME customers possessed credit cards offered by the banks while the remainder never had a credit card. Promoters utilized personal credit cards for business-related transactions, which needed to be segregated from personal transactions, Nath told Financial Express Online. U GRO is looking to acquire a 1 per cent market share of the SME lending market by 2025 which translates to around Rs 20,000 crore asset under management. With this collaboration, Nath now seeks a contribution of an incremental around 5 per cent of the AUM target. According to the World Bank estimates, the MSME credit gap is at $380 billion (around Rs 28.34 lakh crore).

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