Accion & SAIF Partners Co-Invest In MSME Lender Aye Finance

The dearth of capital investment in India’s MSME sector has long fielded an unorganized sector of informal moneylenders charging exorbitant interest rates.
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Looking to formalize the lending process and offering secured loans to MSMEs is Aye Finance, which has raised $1 million in seed funding led by SAIF Partners and Accion.
The firm looks to address the ‘missing middle’ – providing capital to MSMEs that are too small for commercial finance and too large for traditional microfinance.
Aye Finance provides loans as low as $1,000 at market rates, and serves borrowers from industries such as shoemaking, garments, textiles, leather and auto components.
The debt gap for MSMEs in India is estimated to be $198 billion, and is increasing at 11 percent per year. The 40 million micro-businesses in India today constitute the fastest growing segment in the industrial sector.

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