“Digital lenders like NeoGrowth are making credit access easy for small and medium businesses and fulfilling their financial needs”: Arun Nayyar, CEO, NeoGrowth

Arun Nayyar, CEO, NeoGrowth

NeoGrowth Credit Pvt. Ltd is a Systemically Important, Non-Deposit taking NBFC and a pioneer in SME lending based on the underwriting of digital payments data. NeoGrowth provides finance to small business owners to drive business growth. We provide financing to retailers and any other MSMEs with flexible repayment options and customized products addressing multiple business needs. NeoGrowth has already raised INR 500 Crores equity and twice the amount as debt.

MI in an exclusive interaction with Mr. Arun Nayyar, CEO, NeoGrowth Credit Pvt Ltd. Arun, a Chartered Accountant, was earlier with Edelweiss where he was heading the SME Lending business of the group. Arun is a seasoned finance professional with over 20 years of diversified experience in the domain of commercial and consumer lending.

Let’s read:

Q) Tell us about the Business loan carnival.

Our ‘Business Loan Carnival’ started in October for MSME customers to extend Express Loans under our direct-to-customer (D2C) initiatives. This initiative aims to provide a much-needed boost to retailers, small businesses, and the economy at large. To simplify the loan application process for SMEs, we have digitalized the entire process, and are offering instant loan approval at various touchpoints. We’re offering small ticket loans with an easy daily repayment model. Initially, we launched the Business Loan Carnival in 4 cities, but now we are covering 7 cities with this initiative – Mumbai, Delhi, Chennai, Rajkot, Bangalore, Hyderabad, and Kolkata.

Also read: NeoGrowth Launches ‘DiGibizz’ To Meet Growing Business Needs Of SMEs

Q) What kind of response have you received so far?

We are seeing an encouraging response from small businesses in cities where this Carnival is on. So far, we have connected with over 12, 000 small businesses. The process of offering quick approvals to the merchants during the festive time has really been an eye-catcher. During the festive season, apparel shops, spas, and salons witness a lot of customer footfall, and we too saw major interest from these segments for our offerings. Our customers have a positive business outlook for this festive season, and our aim is to help them benefit from relevant opportunities by offering quick loan approvals through this initiative.

Q) How do you see the economic revival going further?

India is home to over 6.3 crore MSMEs. These MSMEs play a major role in the country’s economic revival, employment generation, regional economic development, contribution to GDP (which is approximately 30%), and exports. The ease of doing business depends a lot on ease of access to finance by MSMEs. Digital lenders like NeoGrowth are making credit access easy for small and medium businesses and fulfilling their financial needs.

Another aspect to note is that GST collections for October 2021 stand at over INR 1.30 lakh crores, which is 24% higher than GST collections in the same month last year. The high GST collections indicate that the overall economic activity has surpassed pre-COVID levels.

Q) How hassle-free is the loan process as committed by you?

In addition to digitalizing the process, we offer collateral-free loans, which encourages more small business owners to apply for loans at NeoGrowth. We take into account the digital transactions of a business for credit risk assessment, which means that any small business owner who hasn’t taken a loan in the past and lacks credit history can take formal credit based on the cash flow trends of his business. The cash flow-based model of lending that we follow helps us assess the health of a business and analyze the repayment ability of the borrower. Minimal documentation, fast disbursals, and easy repayment options including daily repayments make the entire journey hassle-free and seamless for our customers.

Arun Nayyar Neogrowth

Q) Tell us about your platform “diGibizz”. And how beneficial it is for the customers?

We launched diGibizz, an end-to-end platform, in February this year, to enable small businesses to transform themselves and become digital-ready. Based on a quick analysis of the business through the diGibizz Digit-O-Meter smart analysis, we provide consultation and technology solutions through our network of partners that help small businesses scale up and become profitable. So far, over 31,000 small businesses have participated on the platform.

Also read: NeoGrowth Credit Pvt. Ltd. Signs Ajinkya Rahane As Brand Ambassador

Q) As festivities are still around the corner, what is your expectation for the brand in terms of growth and revenue?

Our new business volumes are already at pre-COVID levels. The credit demand in the market has returned, as evident by our monthly disbursement run rate post the second wave of COVID-19, which has surpassed INR 150 Crores. Supported by the positive sentiment carried forward from the festive season and opening up of business activities in most markets, we expect our overall loan book and corresponding revenue to grow in line with our disbursement.

Q) What are your future plans?

The adoption of digital payments in India is on the rise, and that’s evident from the value of UPI transactions in October 2021 reaching INR 7.71 lakhs, with 4.2 billion registered UPI transactions. The company is well poised to capitalize on the rising digital payments ecosystem as our business model leverages digital payments data to provide access to capital to small businesses. We will continue to build on our cash flow-based lending model.

We plan to expand our unique proprietary platform “diGibizz” and bring out a suite of products and solutions to suit every small business owner at every stage of their growth lifecycle through our network of partners.

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