For the Germany-based company, founded in 2018 by founders of SME-focused payments company BillPay, India is one of the top priority markets since the trade finance in the SME space is largely broken as the traditional banks and NBFCs are unwilling to cater to this segment, the company says.
According to MODIFI, the total trade finance is worth USD 20 trillion, in 50% of requests for trade finance by SMEs are rejected by banks, resulting in a funding gap of USD 1.5 trillion annually.
The company has so far financed over USD 400 million worth of trade largely in the European market. MODIFI representatives have said that the opportunity in the Indian market is huge with exports worth USD 140 billion every year. However, 40% of the exporters are small or medium-sized businesses and are denied credit by banks and NBFCs. The company, which raised about EUR 5.5 million from a clutch of strategic investors led by global shipping company Maersk, facilitates loans in the range of USD 5000 to USD 75,000.
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