Razorpay enters SME lending, announces new financial products for partners

The B2B payments startup entered the lending business with Razorpay Capital and launched new features like Razorpay X and Razorpay Flash Checkout to offer business banking services to its merchant partners.

Payment solutions company Razorpay today announced that it was entering the SME lending space with Razorpay Capital, a lending platform designed to support SMEs with instant and easy access to lenders. It is aimed at solving liquidity and cash-flow challenges by offering quick settlements and collateral-free loans.

Razorpay Capital uses their merchants' transaction history on the platform to assign a credit score, based on which its lending partners will disburse loans.

A beta version of the platform was launched in September this year and has already disbursed $30 million in loans and hopes to finish with an exit run rate of $100 million by March, according to Co-founder and CEO Harshil Mathur.

It also announced the launch of two more financial products at its flagship fintech conference, FTX, held in Bengaluru today. The newly launched features are an addition to its existing Razorpay 2.0 product suite.

Razorpay X is a comprehensive API banking platform for business operations and transactions. This solution will allow businesses to have a unified banking service, manage payments and refunds, instantly disburse payments and provide them with real-time business insights.

Razorpay Flash Checkout, an upgrade of its existing payment gateway product, now has new features and options for faster and easier checkouts, along with a 'pay-later' optionat the time of checkout via partners such as EarlySalary, ZestMoney, GetSimpl, etc.

The company also announced the launch of The X Club – a startup community aimed at nurturing and empowering aspiring entrepreneurs and startups.

“Our key mission is that while our clients disrupt the Indian economy with new ideas, products, experiences and new jobs, we want to power their financial systems. In the next five years, India is going to be a continuous story about digital growth, and we believe that these products will create a significant impact on every vertical,” said Harshil.

Founded in 2014 by IIT-Roorkee alumni Harshil Mathur and Shashank Kumar, the company provides businesses with technology-driven solutions to address their payment and disbursal challenges. The Bengaluru-based fintech player has raised a total of $31.5 million in risk capital from investors such as Tiger Global, Matrix Partners, YCombinator and Mastercard.

The company also claimed to achieve 5x growth in revenue and a merchant count of 3 lakh in the next fiscal year.