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KredX Allocates 1,500 Cr To Power MSMEs Ahead Of Festive Season 2022

A KredX study found out that this shortage is felt acutely in the runup to the festive season, during which MSMEs witness increased demand for goods and services

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KredX, an Indian supply chain finance platform on Thursday said that it will disburse Rs 1500 crore working capital, over and above the usual disbursement, to cater to the increasing working capital needs of MSMEs ahead of the upcoming festive season.

This additional allocation comes at a time when this sector, which accounts for 27 per cent of GDP and is crucial to the functioning of the economy, is staring at an acute credit gap of about USD 380 billion. 

A KredX study found out that this shortage is felt acutely in the runup to the festive season, during which MSMEs witness increased demand for goods and services.  

Out of the 63.05 million estimated MSMEs in India, about 71 per cent experienced a significant increase in sales during the festive season, with 42 per cent comprising online businesses. 

Almost 57 per cent of the working capital demand arises from tier-1 cities with Bangalore leading from the front, followed by Mumbai, Delhi NCR, Pune, Chennai and Hyderabad

The remaining 43 per cent of the demand arises from tier 2 and 3 cities with Nasik, Guwahati, Coimbatore, Vadodara and Bhopal leading the demand, the study revealed. 

Manish Kumar, Founder & CEO at KredX said, “KredX has been coordinating its efforts towards working in line with the government’s mission of providing easy access to working capital to businesses. The festive season stands as a crucial period for MSMEs as they witness an enormous uptick in sales during this time."

Kumar, however, added that the credit gap that the MSMEs have been facing is appalling and has led to stunted business growth for the segment. This initiative comes at a pivotal point, as it has been predicted that the economic downturn will halt the growth trajectories of many industries. 

"We are aggressively working towards addressing the credit gap and paving a route to efficient and hassle-free credit access. KredX has allocated an additional 1500 crores as working capital to empower MSMEs and ready them ahead of the festive season," Kumar said.

He added that we are also noticing a huge demand uptick from the tier 2 and 3 cities and we hope to bring door-step and affordable finance across India. For the next 12 months, we will be focussed on very aggressive growth and aim to double the disbursement by the 2023 festive season.


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KredX msmes Festive Season 2022