MSME cash flows can be erratic; lenders must know'

FlexiLoans.com, a lender to small businesses starved of credit from legacy institutions, uses digital tools to make good the lack of transparency and thin files of borrowers. The firm intends to hit an annualised disbursement of ₹5,000 crore, and has set an internal target of 10,000 crore for the next three years. RITESH JAIN, co-founder of Flexiloans.com, spoke with RAGHU MOHAN in a telephonic interview. Edited excerpts:

- RAGHU MOHAN

Now that the Reserve Bank of India (RBI) has tightened funding norms, how do you see growth from here?

The RBI has raised concerns about small ticket-size lending, particularly personal loans under ₹50,000 or 1 lakh. But we focus on lending to MSMEs (micro, medium and small enterprises), which is supported by schemes like Mudra and e-Credit Guarantee Fund Scheme for Micro and Small Enterprises. While there may be restrictions on personal loan lending, MSME funding remains relatively unaffected.

Initially, there was some confusion, but once we clarified that we specialise in MSME lending the situation improved.

What sets FlexiLoans apart from banks and NBFCs in this segment?