The first-time borrowers and first-generation entrepreneurs have not only sustained the economic toll of Covid-19 but also shown greater resilience during the pandemic, according to a NeoGrowth Social Impact Study 2021. The first-time borrowers and first-generation entrepreneurs have shown a rise during the adversity by seizing the right opportunities and utilising the financial instruments to their best of capabilities.
Digital lender NeoGrowth which provides services for underbanked SME businesses released the Social Impact Report 2021. According to the report, the company has given 64.5% of its loans to first-time borrowers while 84% of the total loans disbursed were to first-generation entrepreneurs to overcome Covid induced challenges and capitalize on the opportunity.
Over 20,000 MSMEs across seven cities including Mumbai, Pune, Delhi, Chennai, Ahmedabad, Bengaluru, and Hyderabad participated in the survey. The survey assessed the impact of loans on the lives of its customers.
NeoGrowth reported that it has provided lending facilities to first-generation entrepreneurs, women entrepreneurs. The company has also facilitated job creation for its customers and improvement of credit scores.
Around 85% of the customers surveyed experienced severe impact due to business shutdown or low business. 70.6% of the customers reported sustaining their business through their own savings, while 10.6% opted for loans from the company. 3% of the customers explored alternate business opportunities in areas that were booming during the pandemic.
World Economic Forum’s Global Gender Gap Report 2021 observed the disproportionate impact of the pandemic on women further deepening the existing economic and social inequalities.
The company’s loans to women-run or women-led businesses showed an uptick of 32%. 4% of the total loans disbursed by the company were to first-generation women entrepreneurs during the pandemic.
The company has also convinced 92% of its borrowers to avail of health insurance.
The digitization process witnessed 38% YoY growth as of September 2020, despite the Covid-19 pandemic.
NeoGrowth disbursed payments through digital channels, increasing transparency, and assisted customers with the process of digitising their business through its proprietary DiGibizz platform.
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