The Man Enabling Indian SMEs to Get Loans Thinks New-age Lenders Will Change the Game for India

Gaurav Hinduja spoke to Entrepreneur India on the hottest topic that has created great interest in a cash-crunched economy in India – lending to SMEs and ways to strengthen them.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

The man with a deep operating experience in India with detailed knowledge of complex supply chains, Gaurav Hinduja, the co-founder & MD of Capital Float, is popular among the Small and Medium Enterprises (SMEs) of India for lending capital.

His venture Capital Float, formerly known as Zen Lefin Pvt Ltd, was founded by Hinduja and co-founder of Capital Floats Sashank Rishyasringa to enable SMEs to break limits. The company boasts of providing fast, flexible, and transparent working capital finance to SMEs looking to grow their customer orders, purchase inventory, or optimize cash cycles.

Prior to Capital Float, Hinduja ran operations for Gokaldas Exports, India’s largest apparel manufacturer employing 40,000 people with $250 million in revenues.

His digital lending startup raised $22 million from Amazon Inc in 2018 and counts Ribbit Capital, SAIF Partners, Sequoia India and Creation Investments as its existing investors. It competes with digital lending startups such as Ziploan, Lendingkart, Aye Finance and Happy Loans.

He spoke to Entrepreneur India on the hottest topic that has created great interest in a cash-crunched economy in India – lending to SMEs and ways to strengthen them.

Hinduja is an avid believer in the India growth story and thinks the SME lending space in the country has seen an interesting shift.

“In the last three to four years since the revolution of digital lending, we have a lot of young companies that are attacking different niche within SMEs lending space. We were the one who started with sellers online and going after e-commerce and ecosystem-based SMEs,” says Hinduja.

He observes that a lot of traditional organizations that have developed unique underwriting models to go after SMEs in tier three-tier four towns and have developed interesting underwriting models.

“The second thing that happened is the advent of the data  and another ecosystem to provide loans to the SMEs, saved data allows lending to the SMEs, information arbitration has reduced GSTN (Goods and Services Tax Network) has prompted online transactions, data sourcing will help to increase in penetrating of loans to SMEs,” says the Stanford University graduate.

SMEs To Benefit From Economic Shift

Hinduja thinks the demand by SMEs is huge because today about $300 billion of SMEs’ loan goes through the informal sector and what India has started to see is new-age fintech lenders are able to match the speed and execution of an offline money lender.

“What we continue to see is SMEs moving away from informal sector and coming to us (Capital Float) that will increase over time,” believes Hinduja.

Trust While Lending

Hinduja thinks lending is a tricky business but Capital Float is well covered.

“The USP of the business is we look at a few things like traditional data sources, bank statements, bureau scores, partner and transaction level data and psychometric and demographic scores and a combination of these sources along with digital footprints created through social media to get a holistic score on whether the person should get a loan or not,” explains Hinduja.

According to him, Capital Float ensures the company looks into the data of the business - its background and the working style - also the transactions of the company to keep a check on the working and the resources borrowed and lent by it to get a clear picture on whether to invest in the company or not.

The co-founder of Capital Float, Sashank Rishyasringa, was earlier interviewed by Entrepreneur India magazine. 


This Company Wants to Pay You for Your Steps. Here's How it Works.

The co-founder and CEO of Sweatcoin explains how the company’s move-to-earn vision is helping people be healthier while also getting brands in front of 100 million users.

Javier Correa of Sombrero Mexican Food on Restaurant Expansion Strategy

Interview with Sombrero Mexican Food Owner Javier Correa Jr. on celebrity endorsements, finding an effective pace, and the balance of scaling a business.

Do You Inspire the Best in People? Apply for the Tony Hsieh Award

The Tony Hsieh Award seeks out progressive, value-driven leaders and innovators

3 Ways to Achieve 'Superhuman Focus' in Just Two Weeks

Focus is a valuable asset for any entrepreneur. Here's how to upgrade your energy, focus, and drive.

5 Questions to Ask Yourself If You're Thinking About Becoming a Health Coach

The chief revenue officer at the Institute for Integrative Nutrition shares how the program works and the myriad of ways you can use a health coaching certification.

Josh Altman and Matt Proman Are Teaming Up to Disrupt the Real Estate Industry

Serial entrepreneur Matt Proman and real estate mogul and 'Million Dollar Listing LA' star Josh Altman have joined forces to launch

Robert "Don Pooh" Cummins of Brooklyn Chop House on Opening Restaurant Doors

Interview with the Brooklyn Chop House owner and franchising expert about working in the music industry, opening restaurants, and creating avenues for black entrepreneurs.

Feeling Unmotivated? 3 Biohacks to Supercharge Your Focus and Drive

Here's Ben Angel on the top three motivation myths and how to use biohacking to become more focused.

This Physician Wants to Change the Way You Carry Your Baby

Dr. Lena Shahbandar is a physician and entrepreneur who designed a new baby carrier to help parents and caregivers reduce back and joint pain.

Jennifer Allen of Levy Restaurants on a Commitment to Company Culture

Interview with Levy Restaurants VP of Restaurants Operations Jennifer Allen about running successful businesses, being a "restaurant girl", and her company's strong values.

How to Bounce Back After Any Setback with Biohacking

Here's Ben Angel on how to apply biohacking and neuroscience to take back control of your life.

Why Companies Need to "Onshore" to Ensure Sustainable Growth

Entrepreneur Network Partner Ashley Crouch sits down with Sidney Wheatley, CIO of the Private Family Office to H.H. Sheikh Mohamed bin Salman bin Abdulla bin Hamad Al-Khalifa.

How One Entrepreneur Is Bringing Back Old School Hospitality to the Hotel Industry

Hotelier Leo Grika shares his career journey, how he's customizing the hotel experience for guests, and his advice for aspiring entrepreneurs.

The Man Behind the Viral Horse Drawing Meme Talks Advertising

How a drawing for an art school turned into a Game of Thrones viral meme.

Discover Entrepreneur Series

Whether you need advice on how to get your business off the ground or you’re just looking for inspiration, our video series have something for everyone. Browse our library below to find a series that speaks to you and your interests.