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ftcash helps Indian companies accept cashless payments and lend them money

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A Mumbai-based start-up called ftcash helps small businesses in India go beyond cash. In some cases, it also provides loans to finance their operations.

Co-founder Vaibhav Lodha, who demonstrated ftcash today on TechCrunch's Startup Battlefield, said he received the idea from his newspaper vendor who complained that none of his clients had the money to pay for it. The problem was serious enough to create a cash flow problem for the seller, prompting him to consider going to a loan shark.

Thus, ftcash allows any merchant with a feature phone and a bank account to accept a variety of cashless payments – including credit cards, debit cards, mobile wallets and PayPal – after a few minutes of payment. # 39; installation.

Lodha says that he reaches these merchants by hiring a small team in each market, then looking for distribution partners and other companies with whom he can work to increase distribution.

There are already 25,000 registered traders, and the company has experienced a monthly growth of 30% over the last 18 months. Most of these merchants do not have point of sale hardware in advance, so after registering with ftcash, the startup ends up processing between 10% and 50% of their purchases.

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Lodha also pointed to India's recent decision to abolish some rupee notes as a sign of a larger change in money (although the effects of the policy are still debated).

And as already mentioned, ftcash does not only provide payment technology. Lodha said that these traders often have trouble getting loans from banks because limited financial records make it difficult for lenders to create "a credible risk model."

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But thanks to the payment data that ftcash is already collecting, Lodha said his team could make the loans safe and smart. The data also allows the company to see when a borrower might have financial difficulties, so "if a trader goes south, we can be the first online to get our money back."

To be clear, the Lodha start-up does not actually provide capital for these loans – which comes from an undisclosed financial partner. From the merchant's point of view, however, his relationship is entirely with ftcash. Loans typically range from $ 1,000 to $ 20,000, with interest rates ranging from 18% to 30%. Lodha acknowledged that these rates might seem high, but he said that, compared to loan sharks who charge between 50 and 300 percent, "it's a really cheap loan."

Lodha also begins to think of an international expansion and considers Southeast Asia, the Middle East and Latin America as possibilities. In accordance with the company's growth strategy, he is interested in selling the technology to international partners who might want to offer it under their own branding.

The company is currently participating in the Mastercard Start Path program. It is supported by PayPal, IvyCap Ventures and others.

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