LenSmall business lending fintech platform U GRO Capital has launched ‘GRO Micro’, a dedicated distribution channel to aid lending services specifically for the unorganised Micro Businesses based in non-metro markets.
The company announced that it has expanded its distribution network by adding 25 branches across 5 states – Karnataka, Tamil Nadu, Gujarat, Telangana, and Rajasthan.
With this geographical expansion under the flagship of ‘GRO Micro’, the company aims to offer small ticket loans – secured against property, as well as unsecured loans, to micro businesses, for help them in:
1. Sustenance and stability in the post pandemic era,
2. Meeting their working capital needs to fix broken cash flows and
3. To cater to their business expansion needs
U GRO Capital started its journey after it shortlisted 8 sectors and 38 sub-sectors, basis an 18-month process involving extensive study of macro and micro economic parameters carried out in conjunction with market experts like CRISIL.
The eight sectors shortlisted were Healthcare, Education, Chemicals, Food Processing / FMCG, Hospitality, Electrical Equipment and Components, Auto Components, Light Engineering and Micro Loans. Using its first-hand lending experience and insights drawn from use of advanced data analytics, the company added Micro Enterprises as an additional sector in itself within the second year of its operations.
Based on its internal research, the company found that there exists an opportunity to connect with over 5 million MSMEs in target markets, away from the urban centres. These small businesses in Tier 2 and 3 regions face a lack of formal capital infusion due to insufficient database and unavailability of requisite documents. This sector alone presents a huge market opportunity prompting the company to launch a dedicated vertical called GRO Micro to cater to these businesses.
U GRO Capital Executive Chairman and Managing Director Shachindra Nath said, “U GRO Capital is built on the philosophy of ‘solving the unsolved credit gap’ of small businesses. With the launch of ‘GRO Micro’ and expanding our physical network we have taken a significant step in our bid to reach out to the unserved and underserved small businesses.”
“Under this initiative, we aim to reach out to over 5 lakh small businesses across 5 states – Karnataka, Tamil Nadu, Gujarat, Telangana and Rajasthan to begin with. We intend to carry our experience from these locations and expand our network by a further 75 branches by the end of FY ’22,” he added.
With GRO Micro, U GRO Capital now has an extensive network of 34 branches and presence in 8 states across India.
Key highlights of loans to be offered via GRO Micro:
· Range of amount to be lent: 1L-15L (Secured) and 50K-5L (Unsecured)
· Loan duration: 12 – 36 months (Unsecured) & 1 – 9 years (Secured)
· Timeline for disbursal: 3-4 days (Unsecured); 7-8 days (Secured)