FINTECH’S Outreach to MSME – A Fortune of $380 Billion Credit Gap

Abstract

MSME in India is the second biggest in the world only surpassed by China. Recently, MSME Classification has put up added criteria of Annual Turnover apart from previous benchmark of Investment with upward limit in each case. Short of supply of degree of quantum of loan compared to demand of MSME has created a huge credit vacuum. Traditional banks and NBFCs cannot match the demand because most MSME companies are predominately unorganized. This has created a windfall opportunity for Fintech companies. So far these Fintech companies have expectedly penetrated a portion of the credit gap. For Fintech companies, it is a long way to go before the credit gap is filled up.