PhonePe and SMFG India Credit join hands to offer collateral-free credit to micro-merchants

Leading NBFC SMFG India Credit (SMICC), which is part of Japan's SMBC Group, has partnered with digital payments platform PhonePe to offer collateral-free credit to its merchants, including those in Tier-II and III towns across India.

"This collaboration allows us to reach millions of merchants on the PhonePe platform, offering them convenient and seamless access to our merchant loans," Ajay Pareek, Chief Business Officer, SMFG India Credit said in a statement, adding that the partnership makes SMICC's financial products 'more accessible' to Indian entrepreneurs and small businesses. PhonePe will enable SMFG India Credit to offer Merchant Cash Advance (MCA) to merchants on the fintech's platform.

PhonePe said the collaboration will offer SMICC's lending expertise through PhonePe's reach, enabling easier credit access for underbanked micro-merchants. "The growth potential in the heartland of India, presents a crucial opportunity for digital financial inclusion," Hemant Gala, CEO, PhonePe Lending said. As of August 2025, PhonePe has over 65 crore users and a network of over 4.5 crore merchants.

SMFG India Credit along with its subsidiary - SMFG India Home Finance - have a pan-India presence across over 670 towns and more than 70,000 villages, offering loans to underserved small borrowers.