In the past several years there has been a significant increase in the development of alternative investment opportunities worldwide. One of these opportunities is peer-to-peer (P2P) lending, in which an individual or an institution gives out loans to their peer businesses or individuals without the involvement of a traditional bank. In light of this revolutionary shift in the global investment portfolio, Finja, Pakistan’s leading digital supply chain financing NBFC has launched Pakistan’s first P2P lending platform: Finja Invest, which is licensed and regulated by the Securities and Exchange Commission of Pakistan (SECP).
P2P Lending is here to fill the credit gap for the Micro, Small & Medium Enterprises (MSMEs) that have continually proved themselves to be a pivotal part of the economy, especially during the COVID times when mobility was challenged and localization was encouraged.
With the rise in Pakistan’s startup ecosystem, many emerging business models are centered on the welfare of this segment which is a collective win. However, we still need to be more strategic and come up with sustainable ways to eventually cover the historical credit gap for MSMEs.
We call Finja Invest sustainable because it is not dependent on traditional sources of funds for lending, instead multiple businesses and individuals directly lend out their capital to credit-worthy borrowers. A business provides capital to a fellow business and eventually earns up to 20% annualized returns with a monthly payout. The capital gets deployed on the same day, the principal is always protected and money can be withdrawn at any time. All of this in a 100% digital and instant way, making the process frictionless.
An alternative investment opportunity that enables businesses and institutions to utilize their excess capital which they can invest in MSMEs in need of financing solutions while getting higher returns than traditional investment opportunities, leading to socio-economic success for the whole country.
To date, Finja has made an incredible impact by supporting more than 15,000 MSMEs in more than 39 cities with a credit disbursement of more than PKR. 5.2 Billion and Rs. 250 Billion in payments throughput. Out of this, PKR 75 Million has been lent through Finja Invest to more than 2,000 credit-worthy MSMEs. At the moment, we are providing stock financing facilities to these MSMEs but soon it could be expanded to other assets such as corporate financing, invoice discounting, etc.
Qasif Shahid, CEO and Co-founder Finja, said: “With the commercial license of NBFC-P2P from the SECP, we are assured that the regulators are working towards making Pakistan a financially inclusive, digital, and prosperous society for everyone.”
Finja was founded in 2016 by Qasif Shahid, Monis Rahman and Umer Munawar and is backed by leading global venture capital funds that include Swedish, Vostok Emerging Finance; Japanese, BeeNext; Quona Capital from the United States of America; Ukraine-based ICU along with Descon and Pakistan’s largest private bank, HBL.