The company said it will offer merchants loans up to Rs 1 lakh for a period of 7 to 14 days.
Bengaluru-based small business focused startup Instamojo has launched InstaCash a working capital product for businesses which are selling on its platform.
The company said it will offer merchants loans up to Rs 1 lakh for a period of 7 to 14 days. Once the merchant places a request for the credit, Instamojo will transfer the funds including convenience and processing fee charges. This money will help businesses till the next payment is received by them.
"The current situation has left micro-businesses reeling under pressure to source funds for day-to-day operations…we identified that ‘instant funds’ were the need of the hour. Through InstaCash, we aim to not just empower micro-businesses through digitization, but act as an enabler by addressing key challenges and thus, facilitate smooth operations," said Sampad Swain, Chief Executive Officer, Instamojo.
Several traditional financial institutions have been unable to cater to the demand for capital due to the lack of access to granular data on these small businesses with reference to sales, customers and other metrics. Since these companies sell through Instamojo, the company can gauge their cash flows and repayment capabilities, hence are in a better position to extend credit.
Instamojo provides a host of services ranging from digital payments, logistics to lending for MSMEs. The company today works with and enables over a million MSMEs to build, manage and grow their business.Follow our coverage of the coronavirus crisis here