CredFlow Gets NBFC Licence, To Expand Credit Offerings For SMEs

Fintech SaaS startup CredFlow has received a non-deposit taking NBFC licence from the RBI. The startup operates its NBFC arm through its group entity Cashpositive Finance under the brand name CashFloat.

Prior to receiving the licence, CashFloat was disbursing loans through its partners. With the NBFC licence, it will lend independently. In a statement, CredFlow said this would enable faster approvals, custom credit products, program-based underwriting, and full control from acquisition to collections. 

Following the RBI approval, CredFlow plans to expand its product suite to offer invoice discounting, unsecured and partially secured term loans, manufacturing expansion loans, structured SME finance, and co-lending programmes with leading banks and NBFCs.

Founded in 2019 by Kunal Aggarwal, CredFlow provides a cash flow management SaaS platform that helps SMEs manage their finances by providing a dashboard of pending amounts by customers, sending timely payment reminders, validating invoices and negotiating discounts for early payment. 

Using GST, banking, ERP, and supply chain intelligence, CredFlow also offers structured working capital solutions, including invoice discounting, term loans, and programme-based financing.

The startup claims to cover more than $800 Bn in GST-verified invoice flows and a network of over 6 Mn business entities. This, it claims, gives it a unique, proprietary vantage point to underwrite SMEs.

The startup said its NBFC arm is on track to reach INR 100 Cr in assets under management this year.

Prior to this, CredFlow raised INR 31.2 Cr (around $3.7 Mn) in its pre-Series B funding round co-led by existing investors Inflexor Ventures and a Singapore-based family office in November last year. At the time, the startup said it would use the funds to scale up its financial and lending services and improve tech and innovation stacks.

In 2023, CredFlow acquired Y Combinator-backed business management startup TechBiz in an all-cash deal. 

CredFlow operates in the rapidly growing Indian fintech segment, which is expected to become a $250 Bn revenue milestone by 2030. Within this, supply chain and invoice financing present a big opportunity as MSMEs continue to struggle to get hassle-free credit. 

A number of new-age tech startups are working to address these problems. These startups are also attracting a lot of interest from the investors. 

In June, LoanTap secured INR 74 Cr (about $8.6 Mn) in a mix of equity and debt infusion to expand its invoice financing offering. Prior to that, M1xchange raised $10 Mn (around INR 84 Cr) from Filter Capital in a secondary deal to facilitate financing to MSMEs based on invoice and bills.