Delayed payments are a major cause of financial stress for many of India’s 63 million small- and medium-sized enterprises (SMEs) who still use archaic manual processes to collect money. While contributing approximately 30% of the country’s nominal Gross Domestic Product, these businesses remain woefully underserved by advances in financial technology. For too long, fintech innovation has focused on large enterprises, retailers and micro enterprises while the needs of the mid-market B2B players remain largely unaddressed.
That’s about to change. We’re excited to announce that we’re partnering with Credflow, an SME cashflow management platform that provides an automated, affordable, and simple way for time-strapped business owners to send invoices, collect payments and negotiate discounts for early payments, among other offerings. This compelling value proposition, orchestrated by founder Kunal Aggarwal, has led Credflow to attract more than 5,000 small- to medium-sized business owners who are using the platform to process and synchronize invoices worth approximately $10 billion. All of this growth occurred during the past 12 months. The company launched last May.
Credflow’s potential, though, goes beyond its ability to help customers collect and manage payments. Because of its integration with popular accounting software, Credflow can also support financial services like cash flow financing to help increase small and mid-size businesses’ access to credit.
Cash Management is King for SMEs
Credflow’s simple dashboard provides real-time data on customer invoices and services like:
- Timely payment reminders via email, text, and automated Interactive Voice Response telephone messages so customers can stay on top of their finances wherever they are
- Negotiated discounts for early payments and
- A streamlined process for reconciling payments and invoices
With Credflow, customers are getting paid at least 15% faster – helping cut down working capital cycles by 25-30% while bolstering profitability, liquidity, and time savings.
Credflow works with businesses that generate annual revenues between $100,000 and $3 million and plans to provide these companies with a full-stack software solution that includes such financial services as payments management, cashflow-based financing, and treasury solutions, among others.
With the rise of digitization and mobile adoption, embedded financial services companies like Credflow have the potential to provide small- and medium-sized Indian businesses with better and more relevant financial services at lower costs. Credflow’s business model aligns with our mission to advance a fair finance system for all and we’re thrilled to participate in their $2.1 million seed funding round alongside our colleagues at Omidyar Network India and Stellaris Venture Partners. This innovative start-up team is leading the way for Indian SMEs to better leverage the advantages of fintech innovation and help advance the financial health of their customers and their own businesses.