With this partnership, DBS Bank India aims to meet the needs of SMEs and MSMEs while conducting business through ONDC and expanding its digital solutions beyond traditional banking. The rationale is to leverage data from eSamudaay digital solutions and analyse the end users’ requirements to offer MSMEs customised credit and cash management products for managing collections, payments, payroll, liquidity management, and financial products.
The new offering will be piloted in South Indian cities of Udupi, Thanjavur, Mangalore, and Mysore in 2022. The plan is to offer these solutions to MSMEs in 24 cities across India and manage cash flows of the entire supply chain. Officials of DBS Bank India said that the partnership will help in empowering MSMEs beyond metro and tier-1 markets and in offering financial solutions to local businesses.
The SaaS provider eSamudaay offers digital solutions to the buyers and sellers to make doing business on the Open Network for Digital Commerce (ONDC) convenient for smaller players.
Meanwhile, the financial services group, DBS recently partnered with Gofrugal Technologies to help SMEs catalogue their products and expand their sales channels through ONDC. Earlier, the bank launched a digital and paperless trade financing solution for freight forwarders that leverages Electronic Way (eWay) bill verification for digitalising and simplifying trade transactions.
The SME ecosystem in India
As per data from the Ministry of Micro, Small & Medium Enterprises, as of 25th November 2022, the Udyam Registration portal registered 12,201,448 MSMEs. Indian MSMEs are rapidly adopting digital payments over cash, with 72% of payments done through the digital mode compared with 28% of cash transactions. The rise in digital adoption presents prospects for further growth in the sector.
