Small business lending fintech platform U GRO Capital said it has filed an application with the Indian Patent Office for its distinguished methods and systems for modeling scorecards. This has allowed the company to penetrate a highly unstructured segment, which is driven by physical processes. The model tackles the unavailability of an appropriate MSME database, by utilizing its unique classification technique leveraging the proprietary knowledge base and strength of statistical models. The distinctive underwriting model generates credit score cards customized to suit the peculiarities and nuances of varied business enterprises. This is done by analyzing the historical loan delinquency patterns and cash flow within each selected business segment. The model’s utility is not restricted to businesses, as it enables effective underwriting of individual borrowers, as well. Further, it facilitates trade financing by providing an assessment of downstream and upstream counterparties. U GRO Capital has been using this model since its inception in 2018. Shachindra Nath, Executive Chairman and Managing Director of U GRO Capital said the MSME sector is a significant driver of the Indian economy, yet only 16% of MSMEs in India receive formal credit. A major hindrance to credit access is the limited availability of structured data pertinent to the MSME sector. U GRO Capital’s scorecard-based underwriting model lies at the center of our mission to solve the unsolved credit gap of the SMEs, he added.
