Tata Capital and Capital Float unveil “Pay Later” product for SMEs

Tata Capital has announced that it has signed an agreement with Capital Float to provide Working Capital Loans to financially underserved Small & Medium Enterprises (SMEs) in India.

The company in a statement revealed, Tata Capital will be co-lending on Capital Float’s digital lending platform and, through this relationship, both the companies have collaborated to offer a unique “Pay Later” product to SMEs. Developed in-house by Capital Float, this product provides the borrower with a credit limit of up to Rs.50 lakh for a period of one year, pre-defined on the basis of the information shared by the borrower. The uniqueness stems from the fact that the borrower can make multiple drawdowns within the approved limit, which is reinstated from time to time upon repayment by the borrower.

Speaking on this, Sarosh Amaria, Chief Operating Officer – Commercial Finance, Tata Capital, said, “SMEs are integral to the fabric of our economy contributing around 38% of our country’s national GDP. Tata Capital is deeply invested in providing access to credit to small merchants and entrepreneurs through our Supply Chain Finance Business, in which we are one of the market leaders. Our alliance with Capital Float is another step towards strengthening our market position.”

Sashank Rishyasringa, Co-Founder, Capital Float, said, “Tata Capital is a great fit for us, both in terms of vision and focus on delivering great digital experiences to borrowers. Tata Capital’s extensive expertise in Supply Chain Finance along with our proficiency in developing products customized for SME segments makes this partnership particularly potent from a scalability perspective. We believe new-age Fintech companies and established financial institutions need not compete, but can collaborate to widen the financing options available for SMEs. By co-lending with Tata Capital, we can leverage their balance sheet, while they can diversify their portfolio by lending to newer sets of SMEs.”

According to the company, the unique “Pay Later” product showcases Capital Float’s technological expertise and competency designing innovative working capital solutions for SMEs. Coupled with Tata Capital’s superior digital framework, wide reach and rich experience in this segment, especially while offering customized solutions. This partnership will enhance the customer’s digital journey by delivering a seamless online experience for SMEs in India. Additionally, small enterprises like distributors and B2B buyers stand to benefit by being able to make quick, hassle-free payments to their suppliers or partners while procuring inventory, thereby facilitating the unhindered growth of their business.