Grappling lending and payment fintechs are now getting anchors through investments. Online lending and payment companies are currently bearing two-fold damage--lack of cash flow in the industry due to Coronavirus and 3 months moratorium for EMIs and related loans. Although, fintech companies have now caught investors' eye and thus, safeguarding themselves in this hailstorm.
Of late,the Gurgaon based fintech startup, Xtracap Fintech India Pvt Ltd, has got funding from angel investors. Despite the Covid-19 atmosphere, the company has successfully completed its last tranche of $1 million in the angel funding round.
The company plans to employ funds to cater to the entire ecosystem. It currently manages various subsidiaries such as Bridge2Capital, Bridge2Pay, Bridge2Supplier, Bridge2Hissab and Bridge2health, and wants to increase these businesses further.
The platform claims to manage INR 70.00 crore worth of invoice financing with high financial integrity for small shopkeepers in its limited geography of operations in Rajasthan, Punjab and Telangana.
Brings Ease in Doing Business
Bridge2Capital is currently the growth driver of Xtracap Fintech India Pvt Ltd. Under this, the company offers a unique 100 per cent digital invoice financing app which allows a shopkeeper to choose his GST suppliers and the platform then releases funds to the suppliers for the invoices financed. The process is simple and easy to use with a tech user interface along with transparent management that is helping build its loyal customer base. Now, with additional funding from the last tranche of angel funding, the company will further build on its strong mobile platform offering new products to penetrate further new markets and customers with a 100 per cent digital approach.
"We are one of our kinds in India. Our company has a unique business model as nobody is doing it at present. There are 30,000 people registered on our platform. Retention of the customers is another factor that helped us grab investors' attention," Nishant Singh, Chief Distribution Officer, told BusinessEx.
"Our customer retention is immensely high as compared to traditional loans, thus, if a person creates a credit limit and starts rotating his credit limit, then he does not go out," Singh added.
The company provides digital services, such as Bridge2Pay - a QR based online payment solution. Bridge2Supplier - an app-based order management - logistic and payment solution. Bridge2Health - an online insurance and financial services. Bridge2Gold - a digital gold saving scheme. Bridge2Hissab - a digital ledger for the shopkeepers, their customers and suppliers by march 2021. Bridge2Capital has also received substantial grant funding from CIIE – IIM A to support this unique offering from LMI customers in Bharat.
The Gurgaon based fintech Start- up launched its mobile app - Bridge2Capital - in October 2018 for small shopkeepers to receive limited loan amount to pay their GST supplier bills. Over the years, the company has seen overall customers increase from less than 100 to over 1000 shopkeepers and claims to have manifold increase with over 30,000 registrations across India.
"With increase in digital adoption, this time period will shrink in the future due to the unprecedented the Covid 19 situation," Mohammed Riaz, Founder, CEO & MD at Xtracap, said in the company's official statement.
The company aims to target about 2 million retailers in a serviceable market of 14 million retailers. They aim to provide a digital ecosystem in more than 1500 towns and cities with high consumer demand.
Staggering Fintech Industry
The fintech industry is quite large and comprises multiple layers within it. In terms of lending and saving businesses are concerned, they have dropped a big time. The Indian government announced a mematorium for three months to reduce stress on loan payers. Consequently, in small ticket sizes, if a person does not pay for three months then it becomes difficult (for fintechs) to recover money from 4th or 5th month onwards.
All fintechs in lending and saving space are struggling and awaiting when the lockdown gets over and business resumes, and how the customers behave.