Mastercard and U GRO Capital have entered into a significant collaboration aimed at enhancing financing solutions for small businesses in India, specifically targeting the Micro, Small, and Medium Enterprises (MSME) sector. This partnership is crucial considering that, in India, a staggering 86% of the over 64 million MSMEs struggle with limited access to credit. The collaboration between Mastercard, a global leader in payment technology, and U GRO Capital, a Non-Banking Financial Company (NBFC) specializing in MSME financing, is set to tackle this challenge head-on.
The core objective of this strategic alliance is to implement a comprehensive digital supply chain financing solution. U GRO Capital plans to use its innovative data tech platform and proprietary underwriting model, known as the GRO Score. This model emphasizes cash flow-backed assessments rather than traditional financial and collateral-based evaluations. It leverages alternate data sources, including banking, bureau, and GST behaviors, to extend credit more effectively to the last mile. Specifically, U GRO Capital will offer short-term credit to diverse segments of small businesses, including dealer distributors, last-mile retailers, and women entrepreneurs.
Mastercard, with its extensive global network, will play a pivotal role in uniting stakeholders from both the demand and supply sides on a unified platform. This approach not only aims to provide crucial financial support but also fosters an environment conducive to the growth and prosperity of small businesses. The partnership is underpinned by a shared commitment to innovation, crucial for addressing the complex credit needs within the MSME sector.
This collaboration aligns with Mastercard’s global mission of driving financial inclusion. Mastercard has committed to integrating one billion people and 50 million micro and small businesses, including 25 million female entrepreneurs, into the digital economy by 2025. The partnership with U GRO Capital represents a concrete step towards this goal. By leveraging its resources and network, Mastercard aims to be a catalyst for growth, offering not just financial resources but also the necessary support and connectivity for small businesses to thrive in the evolving economic landscape.