Fintech start-up EnKash eyes tapping MSME finance segment via credit cards

What happens when a small business needs immediate cash to pay dues to vendors, while they are still awaiting payment from their clients.
For representational purpose.
For representational purpose.

What happens when a small business needs immediate cash to pay dues to vendors, while they are still awaiting payment from their clients.

“Getting credit had always been a challenge for small businesses. More if the nature of credit is for the short-term. Mostly, they look out for personal loans at a high-interest rate as no big banks are ready to lend to these businesses for a small period. There was a gap in demand and supply which was the idea behind EnKash,” said Naveen Bindal, chief technology officer and co-founder, EnKash, a start-up dedicated for payment management for small businesses.

EnKash is a cards Fintech start-up, started in 2017, post demonetisation, which Bindal co-founded with his partners Hemant Vishnoi and Yadvendra Tyagi.

“It provides an integrated platform connecting corporate sector, vendors and credit providers and eases working capital requirements of suppliers. It helps businesses manage their purchase orders and invoices, enable and track payments to suppliers or from buyers,” Bindal added.

Even when the model clicked instantly, the real success came with Freedom card, a corporate credit card for the small, micro and medium enterprises and start-ups.“Banks offer corporate credit cards but there were specific products required to address the SMEs and startups, which mostly remains underserved. The freedom card gave them the flexibility to choose the payment timing,” Bindal said.

No wonder the product was an instant hit. The firm, in less than two years, boasts of 50,000 customers, which cuts across all major sectors. The company is currently backed by Mayfield India and Axilor Ventures with raising over $3 million in its Series A funding in April 2019 and said is open to raise funds when required to expand the business.

“This is just a fraction of the potential for growth in this segment. The overall small business accounts for annual transaction worth more than $1 lakh crore. Most of these businesses are weak on documentation and regular banking either neglect them or take a lot of time to process their application. Through technology, we make the process faster, payment option flexible at a rate which is very much affordable. The market is ripe for this business model,” said Bindal.

Although the business has a component of risk, Bindal said with GST, it is easy to verify the business risk of the firm and this is the reason the card processing time is very short.

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The New Indian Express
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