SOLV launches of 'Buy Now, Pay Later' for MSME Sector

BENGALURU: SOLV, a B2B e-commerce platform for micro, small and medium enterprises (MSME), has announced the launch of a Buy-Now-Pay-Later (BNPL) product for MSME buyers and sellers on its platform. BNPL as a concept has already made inroads into the consumer retail sector and seen significant success there, especially in the last year.

In the first phase of the launch, new age fintechs and NBFCs that are a part of SOLV’s extensive network of financial service providers, have started offering invoice financing through BNPL to small businesses on SOLV’s B2B commerce platform, giving them a shot in the arm in this period of COVID19-induced crisis, when many small retailers are running low on capital and cash to finance their needs. With the flexibility of BNPL available to them, small businesses can now service their immediate requirements without feeling severe financial strain, with more time at their disposal to make payments.

In a statement, Jiten Arora, Venture Lead, SOLV said, “The application of BNPL in the B2B segment has been welcomed by our buyers and sellers. This product provides both convenience and financial flexibility to them, which results in growth, even in these challenging times. Going by the trend, one out of three MSMEs will avail this product by the end of 2021. BNPL is expected to contribute to SOLV more than Rs 100 crore worth of business in 2021.”

BNPL is helping SOLV further reinforce trust on the platform as it meets the needs of both parties – sellers who want to be paid upfront and buyers who want credit for financing their inventory. For the partnering fintechs and NBFCs, the BNPL offering helps them increase their volumes of loan disbursal, as well as gives them a way to evaluate a customer’s credit behaviour without incurring a big risk, as the financing is for the underlying business transactions. SOLV’s technology platform enables lending partners to lower cost to serve and thereby finance invoices as small as Rs 3,000. It is therefore a win-win for both small businesses as well as the lending partners.

At a time when traditional lenders have turned largely risk averse due to a weak economy, SOLV’s hassle-free BNPL scheme provides a convenient and viable way to service the daily operational requirements of small businesses. New-age digital lenders have been at the forefront of this concept. SOLV has partnered with three leading new-age lenders – Indifi, ePayLater and Davinta– for this initiative.

“Not only will this association accelerate the recovery process of affected SMEs, but it will also help us understand their underlying transactions and accordingly formalize credit for this critical part of the Indian business ecosystem. With a bundle of convenience and cost-effectiveness for a full cycle of B2B transactions,” said Alok Mittal, CEO, Indifi Technologies, in a statement.

In a statement, Akshat Saxena, co-founder, ePayLater said, “The collaboration will empower retailers and SMEs across India to avail the benefit of instant digital credit as they build their business on SOLV.”

Commenting on the partnership, Ravi Garikipati, CEO and Co-Founder of Davinta said “At Davinta we believe accessible and affordable financial services is key to unlocking the potential of the millions of small businesses in India. We launched our micro enterprise focused buy-now-pay-later credit solution Vyaapaar Shakti to bring on-demand, anytime, anywhere credit to small business while also filling a massive gap in the SMB market today.”

Bolstering SOLV’s financial services offering for MSMEs is its proprietary alternate credit score, SOLV SCORE which uses AI and ML to create a comprehensive score card for MSMEs with their traditional and alternate data. SOLV SCORE is aimed at augmenting and fast-tracking financial services offerings like BNPL on SOLV’s platform and making credit flow to the MSME sector more efficient and effective.

SOLV launches of 'Buy Now, Pay Later' for MSME Sector SOLV launches of 'Buy Now, Pay Later' for MSME Sector Reviewed by TechCO on 1/18/2021 Rating: 5

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