This Fintech Company Is Helping Small Businesses Fix Their Short-Term Cash Flow Needs

Small and Medium Enterprises (SMEs) fuel economic growth and drive social development, especially in developing nations like India. However, to reinforce this backbone, it’s crucial to remove their growth barriers and the struggle to secure financing from traditional banks often creates many of these barriers. Here’s where fintech platforms like VoloFin arrive to help businesses overcome financing barriers and fill a void that traditional banks couldn’t quite address.

A Singapore-based company, VoloFin offers invoice financing to small and medium enterprises (SMEs) in Singapore and India. In an exclusive interaction with Benzinga India, Roshan Shah, the CEO and co-founder of VoloFin, shares insights into how his fintech platform is not just filling the trade finance gap in India but also redefining access to capital for SMEs on a global scale.

What is VoloFin and how does it operate in the fintech space?

Roshan Shah describes VoloFin as a unique entity in the fintech domain, offering end-to-end solutions for both banks and borrowers — a rarity as most platforms often cater exclusively to one or the other.

“In the market, there are either balance sheet-driven lenders or match-making platforms, whereas VoloFin is a multi-lender platform, whereby we have onboarded various lenders including banks, and provide an end-to-end solution to them,” Shah states.

This not only streamlines the financing process but also shields suppliers from buyer non-payment risks, offering collateral-free financing and leveraging a tech platform for full-stack supply chain solutions.

Shah explains that there are either monoline factoring companies in India or outside India financing cross-border trades or newly formed TReDS (online electronic platform for factoring of trade receivables) platforms, which operate like deal sourcing/match-making platforms.

Shah and his team provide a number of services to clients including protection against buyer non-payment risks and letting suppliers operate without the fear of financial loss. The company also provides collateral-free financing options, which simplify access to necessary funds without the burden of securing loans with physical assets.

Volofin’s tech platform rapidly processes KYC and compliance by carefully integrating with various government, legal, and logistical databases, which ensures efficient and accurate information flow.

Under Shah’s leadership, VoloFin has achieved remarkable growth milestones, including a 35-40% expansion rate month-over-month and quarter-over-quarter. The platform recently celebrated financing over $100 million in receivables.

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How was the 2023 financial year for the company?

Shah explains that 2023 was a banner year for VoloFin, marked by strategic partnerships and industry-first achievements. Notable highlights include the onboarding of India Exim Finserve IFSC Private Ltd. — a subsidiary of the Export-Import Bank of India (Exim Bank) that offers trade finance and related services to Indian exporters; and pioneering the first invoice factoring transaction on the ITFS platform, a service that helps exporters and importers get credit from global institutions through factoring, forfaiting, and other trade financing services.

How is VoloFin assisting SMEs beyond banking?

VoloFin’s impact on SMEs, particularly in tier-2 cities, has been immense, claims Shah. “We are the only fintech providing end-to-end solutions, from origination to collection, including credit protection with Insurance to platform lenders,” Shah explains. This approach has allowed SMEs to significantly grow their operations.

Unlike banks, VoloFin offers flexible financing options that help SMEs invest in technology, infrastructure, and talent without the need for collateral. Their user-friendly platform simplifies processes, enabling faster decision-making and efficient fund management.

VoloFin’s approach goes beyond the constraints of traditional banking by providing personalized support and insights catered to the specific needs of SMEs. The platform is not balance sheet driven and assumes buyer risk default, transforming long receivables into instant liquidity which in turn supports SMEs in increasing their order volume and production capacity.

Distinguishing itself further, VoloFin’s technology platform handles everything from origination and KYC to credit assessment and debt management. The platform’s comprehensive factoring solutions attract multiple lending partners from APAC to the U.S., enhancing competitiveness and risk capacity. Additionally, VoloFin offers Trade Credit Insurance policies providing 100% coverage in case of a buyer default, backed by a team skilled in managing such policies.

“Our tie-up with lending partners across different countries allows us to take exposure to geographies such as LATAM countries, that are currently not being serviced by the existing lenders,” states Shah.

With multiple developments on the horizon, Shah is optimistic about the future. The platform’s goals for the upcoming year include significant lender onboarding, integration with a top global bank, and potential equity participation.

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Note: This interview was conducted over email.