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What is the story about?
SMFG India Credit (SMICC), a non-banking finance company (NBFC), has partnered with PhonePe to provide collateral-free Merchant Cash Advance (MCA) loans to merchants registered on the PhonePe platform.
The partnership aims to widen credit access for micro-merchants, particularly in Tier-2 and Tier-3 towns, where many small businesses operate with limited access to formal lending channels. Under the arrangement, SMICC will disburse loans to eligible merchants directly through PhonePe’s platform.
According to industry estimates, India has more than 60 million micro, small, and medium enterprises (MSMEs), many of which struggle with working capital requirements due to lack of collateral or credit history. By leveraging PhonePe’s network of over 45 million merchants and SMICC’s lending expertise, the partnership seeks to bridge this financing gap.
Ajay Pareek, Chief Business Officer at SMFG India Credit, said the alliance would help extend financial solutions to self-employed individuals and small business owners, offering them convenient access to credit. He added that this step aligns with broader efforts toward financial inclusion.
Hemant Gala, CEO of PhonePe Lending, said the collaboration provides an opportunity to expand credit penetration in India’s heartland by combining PhonePe’s digital reach with SMICC’s loan offerings.
SMFG India Credit, part of the Sumitomo Mitsui Financial Group (SMFG), has a presence in over 670 towns and 70,000 villages through 1,000 branches and a workforce of 25,000. It offers a range of lending products, including SME loans, vehicle financing, home loans, and personal loans.
PhonePe, launched in 2016, is one of India’s leading digital payments platforms and has expanded into financial services, insurance, and lending.
The partnership aims to widen credit access for micro-merchants, particularly in Tier-2 and Tier-3 towns, where many small businesses operate with limited access to formal lending channels. Under the arrangement, SMICC will disburse loans to eligible merchants directly through PhonePe’s platform.
According to industry estimates, India has more than 60 million micro, small, and medium enterprises (MSMEs), many of which struggle with working capital requirements due to lack of collateral or credit history. By leveraging PhonePe’s network of over 45 million merchants and SMICC’s lending expertise, the partnership seeks to bridge this financing gap.
Ajay Pareek, Chief Business Officer at SMFG India Credit, said the alliance would help extend financial solutions to self-employed individuals and small business owners, offering them convenient access to credit. He added that this step aligns with broader efforts toward financial inclusion.
Hemant Gala, CEO of PhonePe Lending, said the collaboration provides an opportunity to expand credit penetration in India’s heartland by combining PhonePe’s digital reach with SMICC’s loan offerings.
SMFG India Credit, part of the Sumitomo Mitsui Financial Group (SMFG), has a presence in over 670 towns and 70,000 villages through 1,000 branches and a workforce of 25,000. It offers a range of lending products, including SME loans, vehicle financing, home loans, and personal loans.
PhonePe, launched in 2016, is one of India’s leading digital payments platforms and has expanded into financial services, insurance, and lending.
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