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Aye Finance gets support from Unilever, UK govt. and EY-led partnership to finance supply chains for Kirana Stores

Credit and Finance for MSMEs: The kirana borrowers will be able to avail credit from Rs 20,000 to Rs 5 lakh in revolving credit.

Credit and Finance for MSMEs: Small business lender Aye Finance on Thursday announced receiving a grant of Rs 2 crore (£2,00,000) from Transform, a joint initiative of Unilever, UK’s Foreign, Commonwealth and Development office, and Ernst & Young to provide unsecured small-ticket loans to credit-starved kirana stores in the country. 

“The company has provisioned a credit line for more than 10,000 kirana stores through its SwitchPe app. The kirana borrowers will be able to avail credit from Rs 20,000 to Rs 5 lakh in revolving credit,” Sanjay Sharma, MD and CEO, of Aye Finance told FE Aspire.

The shop owners will have to register on the SwitchPe platform with the basic KYC documents, Sharma added.

According to a company statement, TRANSFORM combines grant funding, business insight and wider resources for entrepreneurs with in-depth research. The initiative has supported over 100 projects in 17 countries so far.

The grant support for Kirana stores assumes significance as the latter account for around 88 per cent of the country’s retail sector. However, most of the Kirana stores lack access to working capital, restricting their as well the sector’s growth. 

Aye Finance, since its inception in 2014, has supported over 6 lakh MSMEs, including 50,000 Kirana stores and has overall assets under management (AUM) worth Rs 300 crores for Kiranas.

After two years of constrained growth during the pandemic, the company had reported a surge in credit uptake among micro-enterprises in the year 2022-23. As on March 31, 2023, Aye Finance had an AUM of Rs 2,700 cores and over 3 lakh active customers, growing its loan book by 56 per cent during the year. 

The company, backed by investors such as Elevation Capital, CapitalG, Alpha Wave Global, Light Rock, A91 Partners and MAJ Invest, had registered a revenue of Rs 630 crores during FY23.