Mumbai-based supply chain financing platform Cashinvoice has raised $3.4 million in its Series A round from HDFC Bank, Pravega Ventures and Accion Venture Labs. Founded in 2019, the fintech firm operates a digital marketplace for invoice discounting, providing customised supply chain financing (SCF) solutions to buyers and suppliers of mid and large corporates. In an interaction with ET Digital, Arun Poojari, Co-founder and CEO of the firm, explains how the new funds will be used to make a significant impact on the MSME sector. He also discusses recent developments in the SCF space, the company’s plans, and how HDFC Bank’s role as an investor would help it realise its long-term strategic goals. Edited excerpts:
ET: How does the company plan to deploy latest funds to make a significant impact on the MSME sector?
This current funding round will allow us to strengthen our end-to-end supply chain finance offerings and extend our footprints to deep tiers of the supply chain. Many micro and small firms struggle to secure critical working capital for their daily operations. Leveraging invoice-based unsecured financing is an excellent tool in addressing this pressing need. Our overarching goal with our deep-tier solutions is to empower these small-scale businesses by giving them quick access to liquidity against invoices to larger organisations in the supply chain network.ET: How will HDFC Bank contribute as an investor and align with Cashinvoice’s strategic vision?
Cashinvoice and HDFC Bank share a longstanding partnership focused on driving digital transformation within the supply chain finance landscape. Through continued collaboration, Cashinvoice and HDFC Bank will leverage their combined expertise to co-develop innovative products tailored to address the working capital needs of MSMEs. The bank’s strong network and presence across the supply chain finance space will also help Cashinvoice amplify the reach of its solutions and position itself as a significant enabler of supply chain financing activities.ET: What are your business expansion plans and the projected throughput numbers? How does the team plan to raise the loan book now?
With this strategic investment, we are set to substantially grow our financing volumes, expanding our presence to include the full range of supply chain solutions in India. We foresee a significant rise in funded throughput as we onboard additional medium and large anchor corporates. We aim to exceed a throughput of Rs 20,000 crore in FY 2025, by discounting close to 12-15 lakh invoices. This projected growth trajectory is underpinned by our commitment to leveraging innovative supply chain finance solutions to extend financial inclusion to the missing middle segment.
ET: What are the recent developments on the platform, including value and the number of invoices discounted, key collaborations with banks & NBFCs, etc?
Through strategic partnerships with top private sector banks and NBFCs, Cashinvoice has ensured regular funding for transactions, contributing to its projected financed throughput of over Rs 10,000 crore in the current financial year. Furthermore, the platform’s increasing network now comprises over 1,500 new SMEs added during the last 12 months, serving as suppliers to anchor corporates.
Cashinvoice is also extensively working with some of the major NBFCs and banks to digitise their end-to-end SCF processes. These efforts, coupled with strategic collaborations with corporates like Tata Motors, Bata and Patanjali, underscore Cashinvoice’s reputation as a trusted partner and foster financial inclusion within the MSME ecosystem.
ET: How do you see the recent developments in the SCF space and the industry scenario based on these?
Supply chain financing offers significant potential to accelerate the pace of financial inclusion for small businesses. For years, due to paper-based processes, SCF has been unable to cover the long tail of the supply chain ecosystem. This effectively excluded micro and small firms from the scope of SCF support. With increased collaboration between banks and fintechs, this is expected to change, providing access to the last mile. Many new technologies, notably blockchain, promise to disrupt the way this market has traditionally operated, allowing for quick and easy access to SCF products. With the anticipated expansion of credit insurance in India, we believe SCF can meet the majority of working capital requirements for both large/medium and small enterprises.
ET: Did the interim budget meet your expectations?
The government’s commitment to timely finances, relevant technologies and appropriate training for MSMEs signals a strategic alignment with sectoral growth and global competitiveness. The subtle adjustment of the regulatory environment to promote MSME expansion appears as a critical component of the overall policy mix. The intersection of technology and strategic policy measures announced in the interim budget demonstrates an attempt to boost economic growth, empower MSMEs, and position India as a global economic contender. Furthermore, technological improvements have made digital financing platforms effective accelerators for MSMEs. These platforms enable rapid and efficient access to capital, reducing bureaucratic delays that frequently impede financial activities.
