Private sector lender YES Bank, which is working closely with micro, small and medium enterprises for their banking requirements, has launched loan products that use their bank statements and Goods and Services Tax (GST) returns for ascertaining their credit worthiness. “We have operationalised a GST return-backed funding of up to ₹1 crore. We have tied up with a fintech Karza, which extracts information real time from GSTN, which can be used along with KYC,” said Sumit Gupta, Group President and Group Head – Rural Banking and SME Banking, YES Bank.
Similarly, the private sector lender has also operationalised another product, where it uses the transacting bank’s records or bank statements as a surrogate to estimate the revenue and credentials of the company and give a firm sanction on that basis. While these two are secured products, Gupta said that YES Bank also offers an unsecured loan product of a smaller ticket size of ₹25 lakh. “If the loan applicant has been transacting with YES Bank for the last six months or so, we will use that as a surrogate to give a small ticket unsecured loan,” he said.
As on September 30, 2018, advances to Micro, Small & Medium Enterprises (MSMEs) by YES Bank amounted to 8.3 per cent of the total advances. Noting that a large part of MSMEs still have little access to formal banking, Gupta said the lender has been working with these firms since its inception in 2004, but has been particularly focussing on them for the last two to three years. “The sector for us is supremely efficient when it comes to credit behaviour,” he further said.