Finja Invest is Pakistan’s first peer-to-peer (P2P) lending platform for micro, small & medium enterprises (MSMEs).
Tell me more: P2P lending is when an individual or an institution gives out loans to their peer businesses or individuals without the involvement of a traditional bank.
SMEs are usually unable to score loans from banks because they do not have a credit history.
Finja is trying to cover this credit gap for them.
It connects the investors to the SMEs (kiryana stores) and offers short-term loans to these stores and a return on investment to the lenders.
How it works: Finja does not depend on traditional sources of funds for lending. Instead, multiple businesses and individuals directly lend 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 The capital gets deployed on the same day, and money can be withdrawn at any time.
This provides businesses and institutions with an alternative investment opportunity to invest their excess capital in MSMEs needing financing solutions while getting higher returns than traditional investment opportunities.
You should know: Finja was founded in 2016 by Qasif Shahid, Monis Rahman, and Umer Munawar. It has raised $15.6 million in funding.
Finja received its Non-banking Financial Company (NBFC) license from The Securities and Exchange Commission of Pakistan (SECP) in December last year.
Before you go: Finja claims to have lent Rs. 75 million through Finja Invest to more than 2,000 MSMEs.