A Mumbai-based startup known as ftcash helps small companies in India transfer past money. In some circumstances, it’s additionally offering loans to fund their operations.
Co-founder Vaibhav Lodha, who demonstrated ftcash on-stage at the moment at TechCrunch’s Startup Battlefield, mentioned he first received the concept from his newspaper vendor, who complained that none of his clients appeared to have the money at dwelling to pay him. The difficulty was severe sufficient to create a cashflow drawback for the seller, prompting him to think about going to a mortgage shark.
So ftcash permits any service provider with a function telephone and a checking account to just accept a wide range of cashless funds — together with bank cards, debit playing cards, cellular wallets and PayPal — after only a few minutes of setup.
Lodha mentioned he reaches these retailers by hiring a small workforce in every market, after which searching for channel companions and different companies that he can work with to extend distribution.
There are already 25,000 retailers signed up, and the corporate has been rising 30 % month-over-month for the previous 18 months. Most of those retailers don’t have any point-of-sale beforehand, so after they join with ftcash, the startup finally ends up processing between 10 and 50 % of their purchases.
Lodha additionally pointed to India’s latest transfer to abolish sure rupee notes as an indication that there’s a broader shift away from money (even when the consequences of the coverage are nonetheless being debated).
And as already talked about, ftcash isn’t simply offering funds know-how. Lodha mentioned that these retailers typically have hassle getting loans from banks as a result of restricted monetary data make it troublesome for lenders to create “a reputable threat mannequin.”
However due to the funds knowledge that ftcash is already amassing, Lodha mentioned his workforce could make the loans safely and intelligently. The information additionally permits the corporate to see when a borrower is likely to be struggling financially, so “if a service provider goes south, we will be the primary in line to get our a refund.”
To be clear, Lodha’s startup isn’t really offering the capital for these loans — that comes from an undisclosed monetary companion. From the service provider’s perspective, nevertheless, its relationship is completely with ftcash. The loans often vary from $1,000 to $20,000, with rates of interest between 18 and 30 %. Lodha acknowledged that these charges may appear excessive, however he mentioned that in comparison with mortgage sharks who cost between 50 and 300 %, “It’s a very low cost mortgage.”
Lodha can also be beginning to consider increasing internationally and is taking a look at Southeast Asia, the Center East and Latin America as prospects. In line with the corporate’s development technique, he’s keen on promoting the know-how to worldwide companions who would possibly wish to provide it below their very own branding.
The corporate is presently taking part within the MasterCard Begin Path program. It’s backed by PayPal, IvyCap Ventures and others.