In August of 2019, JiT Finco was readying up to launch. A loan product construct was ready. We wanted to take the idea to the market and test it. Our objective was to understand better how an MSME owner perceives the new product. As an important stakeholder, we needed feedback on the product, experience, and delivery. We hit the road, and one of the people we met was Mr. Ponnappan.
Mr. Ponnappan, our first customer*
Mr. Ponnappan runs a small metal pressing unit in the suburbs of Chennai. He supplies to big auto ancillary companies in and around Chennai. He has been serving a fixed set of 5-8 customers for over 30 years now. He is 61 years old and employs about 20 people in the company. His unit is a small proprietorship firm, and Mr. Ponnappan is a hands-on guy. He looks after his customer orders, relationships, operations, and finance.
From outside, it looked like he was all set. He has a business vintage, marquee customers with deep buyer relationships, tremendous experience in running operations, and finance. We wanted to understand his budgeting process go-to avenues for funds. To our surprise, he complained. Government schemes like CGTMSEs or MSME funding schemes excluded many MSMEs like him. It was also impossible to get access because the qualification bar was so high. Since then, we met many more Ponnappans.
We found a Ponnappan like persona in almost every industrial town. We found them across sectors and in all sizes. We know we had a task at hand.
The exercise was a defining moment for us. While working capital loans were the need, we felt, a more empathetic approach to the problem would benefit MSME owners immensely. We decided to keep the MSME owner and working capital requirements of the MSME and the unit health at the center of everything we do.
We believe that simplifying the process, making our MSME loan products more accessible, new ways to qualify a small business for working capital loans, and quick loan processing are some areas within our reach. To make a meaningful contribution to MSMEs, we are innovating along these vectors.