New Delhi, Nov 14 (KNN) SMEs should be backed financially as the dearth of working capital is a major challenge in India, said Drip Capital's Director of Business Development Ankit Verma.

He was speaking at a seminar on ‘Interactive sessions on Export Factoring: Easy access to unsecured finance for SME Exporters’ organized by Drip Capital, in association with EEPC at Jalandhar.

Drip Capital presented comprehensive expertise on trade finance, catered to an audience of diverse fraternities including Exporters, CAs, Financial Consultants, Freight Forwarders and Local Exporter Bodies across emerging markets alongside other eminent speakers sharing valuable insights on varied aspects of the industry.

With the central focus on MSMEs, Drip Capital said “India has the second-largest number of SMEs in the world, accounting for 40% of India's total exports. However, SMEs face many challenges while raising working capital; additionally, the implementation of the Goods and Services Tax has resulted in further blockage of working capital.”

It is advisable to SMEs to have a contingency plan to manage their finances by looking at alternate sources of financing, it added.

Pointing towards Jalandhar economic background, Drip Capital in its press release said “Jalandhar is renowned as a global hub for the manufacture of sports equipment that are used across reputed platforms, including the Olympics, Commonwealth Games, and Asian Games, to name a few. Apart from this, Jalandhar also manufactures and exports hand tools, furniture and glass.”

Jalandhar is also the world's largest manufacturer of leather tool pouches and aprons with major American and European consumers buying from factories in Jalandhar, it added.

Interacting with the exporters at the seminar, Verma said that Jalandhar, also known as the urban hub of Punjab, has played a vital role in fostering the country’s foreign trade and economic development.

However, he pointed that SMEs in India suffer from lack of infrastructure and technology, but nothing is more of a challenge than a lack of working capital. In addition to this, mostly financial support comes at high interest rates with collateral. SMEs should be backed financially as a dearth of working capital is a major challenge in India.

To bridge this gap, Drip Capital is a trade finance company providing collateral-free post-shipment finance to Indian exporters with instant approvals and minimal documentation, he added.

In addition to this, he said “Mostly financial support comes at high-interest rates with collateral to support the sanction and disbursal. To bridge this gap, Drip Capital emerged as a trade finance company providing collateral-free post-shipment finance to Indian exporters with instant approvals and minimal documentation.”

This knowledge exchange program was seen as a very remarkable opportunity for Drip Capital to network with like-minded individuals over dinner before the session came to an end.

The event was graced by illustrious panel of speakers, including Satish Kumar, Addl. DGFT, Ludhiana, Ministry of Commerce & Industry, Govt. of India, Rakesh Kumar, Branch Manager, EGGC LTD, Amarjeet Singh, General Manager, MSME, and Opinder Singh, Dy. Director, SRO Jalandhar, EEPC India.

Drip Capital is a California- and India-based fintech company, providing collateral-free post-shipment finance to SME exporters with instant approvals and minimal documentation. The company was founded by Pushkar Mukewar and Neil Kothari with a philosophy to solve the working capital gap for SME exporters across emerging markets.