Cashflow Management Tutorial for School Owners

Cashflow is the lifeblood of any organisation, including schools. Unlike most small and medium enterprises that have unstable revenue because of variations in customer purchases and seasonal cycles, schools are usually assured of a running income from the fees paid by the students each quarter. However, cashflow management is as serious a task for educational institutions as it is for any other business.

With the fee they receive, schools have to pay their teaching and administrative staff, maintain the campus, periodically purchase lab equipment, sports supplies, furniture and other items, and keep some reserves for unforeseen expenses. When money falls short of requirements, they may have to apply for loans from a school finance company. In addition to banks, FinTech organisations have stepped forward as significant providers of school finance in India.

Whether a school manages its operations with its earnings or takes the support of school finance, it is essential to handle the fund prudently. The following tips for cashflow management in schools can help the owners avoid severe financial constraints:

Anticipate future requirements: Will some students be leaving the school to change their board (CBSE, State Board, ISC, IGCSE) from the next academic year? Will you be hiring any new staff members? Does the school need to replace any furniture or teaching equipment? It is good to have a basic idea of such needs as they have an impact on your earnings and expenses. If you feel that the outflow of cash could be more than the inflow and reserve funds, it may be necessary to apply for school finance.

Make arrangements with vendors: If you have developed long-term relationships with the vendors who regularly supply lab materials, sports gear, canteen groceries and other provisions to your school, you can make occasional arrangements on payment terms. As an example, if your regular pay cycle from the receipt of invoice is 30 days, it can be extended to 45 days in a period when you are spending funds on additional works in the school.

Work to maximise cash inflows: With constant improvements in your education services, you can attract new students, which will have a positive impact on your earnings. Schools that have classes till Standard VIII but have a reasonably high strength of students can work with an education board to upgrade to Standard X or XII. To facilitate the construction of a new building and for additional campus amenities, you can apply for school finance by sending a quick digital application to a FinTech company. The revenue generated from fees paid by students in new upper classes will help you to pay off the borrowed amount and interest in small EMIs.

Stay connected to lenders: If despite your best efforts on cashflow management, money falls short of requirements, remember that funding for schools in India is available on easy terms from a FinTech school finance company. You can get a collateral-free loan, and you need to submit only the soft copies of eligibility proving documents when you choose a FinTech company as your lender.

Apply for Unsecured school loan

Capital Float is a friendly FinTech organisation providing school finance to recognised educational institutions that have functional classes till Grade VIII or above and collect a yearly fee of minimum Rs 75 lakh.

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Capital Float secures $13 million in funding to give loans to small businesses – YourStory

Written by Jubin Mehta

Capital Float is a digital finance company that provides working capital loans to underserved small business in India via a technology-led loan origination and credit underwriting platform. The Bangalore based company today announced that it has raised $13 Million in Series A financing to support the company’s rapid growth. The round was led by SAIF Partners and Sequoia Capital, with participation from existing investor Aspada.

Founded in 2013, Capital Float has created a proprietary technology platform to evaluate the financial health of SMEs and efficiently deliver working capital to a segment that is underserved by traditional banks. Businesses can apply online and get funds in less than 7 days (see how it works). The company currently lends to e-commerce merchants, small manufacturers, and B2B service providers across major cities. The company has been founded by Stanford MBAs Sashank Rishyasringa and Gaurav Hinduja and is a registered Non-Banking Finance Company (NBFC). Along with the headquarter in Bangalore, Capital Float has offices in New Delhi and Mumbai.

To date, the Capital Float platform has delivered nearly Rs. 40 Crore in loans to SMEs across 10+ cities in India. The company claims to have achieved record results in 2014 and saw a 10x increase in online applications, particularly in the e-commerce market where it has partnered with leading marketplaces such as Snapdeal, Flipkart, Amazon, PayTM and Myntra to finance small merchants selling online.

This round of funding will help expand Capital Float’s technology, enabling it to scale up nationally and launch new loan products. The company had raised a $4 Million seed round in mid-2014 from Aspada and SAIF, bringing the total capital raised thus far to Rs. 100 Crore in this fiscal.

“We started Capital Float with the belief that technology and data would be the key drivers in cracking SME financing in India,” said co-founders Gaurav Hinduja and Sashank Rishyasringa. “Over the past year, we’ve focused on building the platform to deliver what our customers want above all else – flexible and ultra-convenient access to finance that can scale with their business. By leveraging alternative data in our underwriting model, we are increasingly able to not only make faster decisions but also lend to emerging business models. We are very excited to partner with SAIF, Sequoia, and Aspada, and truly believe that we now have a world-class set of investors to propel us towards this vision.”

News piece sourced from YourStory. Read the full piece here

Oct 24, 2018

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How Short Term Loans Helps Small Businesses in India

A competitive environment works as a catalyst for growth for businesses, large, medium or small. Small businesses in India have been flourishing in a disorganized market for a while now, capitalizing on trends and changing consumer preferences. Yet one of the challenges they have to deal with is the lack of timely funds, whether by way of short-term business finance or investment in technology or infrastructure for scaling up. The struggle to get affordable financing has resulted in many Small and Medium Enterprises (SMEs) failing to realize their full potential.

This scenario is changing for the better. Term loans offered by online finance companies like Capital Float are your new-age finance options for seizing business opportunities that come your way. A trust-worthy financial partner that you can rely on, Capital Float has helped  enterprises boost their profit margins with convenient short-term business finance options. While some businesses require high liquidity, some may not; but no enterprise can work effectively without adequate cash flows. Restrictive lending policies, inflexible collateral requirements and slow disbursement times offered by formal financiers are of no help to SMEs.

Term loans from online lenders offer a way out of crippling interest rates and the chronic cycle of debt. Read on to find out why it makes sense to seek short-term loans in India.

Easy application procedure

As compared to traditional banks, online lenders such as Capital Float offer the convenience of filling out a 10-minute application form from anywhere, anytime. Digitally uploading required documents translates into an easy and hassle-free process. Given this day and age of instant connectivity, this isn’t a tough task; but going through the multiple layers of process at a conventional bank is.

Prompt approval

Apart from a laborious process of submitting umpteen documents and heavy paperwork, it is likely that a conventional lender will keep a small business owner waiting for loan approval. Compare this to a situation where applicants receive instant approval in minutes. Short loans are the lifeblood for a business. Meeting a smooth supply chain, daily payments, urgent expenses and several other unforeseen expenditures are part and parcel of business operations. Thus lack of liquidity can have ripple effects on many aspects of a business. Through quick approvals for term loans, online lenders ensure SMEs avert such crises with short-term business finance, available practically at their fingertips.

Not just fast, friendly too

Unless SMEs have some collateral to offer, turning to conventional lenders for term loans might be futile. Traditional banks are highly inflexible when it comes to scanning an applicant for short loans. Public Sector banks require a business to be running for at least three to five years to be eligible for a loan. The same holds true for private banks, traditional NBFCs and moneylenders. This is where new-age fintech lenders make a difference. Far more customer-friendly, and digitally enabled, lenders such as Capital Float provide Small and Medium Enterprises even as young as one year old with short term business finance. Aspiring entrepreneurs need some handholding when it comes to finances. These digital lenders are here to do just that.

Easier on the pocket

Term loans acquired through traditional means dig deep into your pockets. But, those availed of online are far easier for a number of reasons, including.

  • Pre closure penalties go up to 5% of the loan. This isn’t the case if you choose to get short-term business finance from Capital Float. We levy no such charges on clients if they wish to close the loan ahead of the term.
  • The processing fees for a short loan offered by traditional lenders start from 2% and in many cases go up to 3%. Financing through Capital Float means SMEs only have to bear a fee of up to 2% in processing fees.
  • An online lending platform offers small business applicants the flexibility of loan tenure— they can choose from anywhere between 1 month to 12 months. Conventional lenders and most private banks don’t offer term loans for that short a period.
  • Short-term business finance procured from PSUs, private banks and traditional NBFCs carry a hidden charge. SMEs don’t have to worry about that when they approach Capital Float for a short loan.
  • Strict repayment options are one of the characteristics of a term loan procured through traditional means. These work on an EMI-only basis. Would it not be far more convenient to have a choice of flexible repayment? All of Capital Floats’ financial products come with easy repayment options. All loan products are offered at a reasonable interest rate.

Variety of loan products

At Capital Float, we understand that every SME works in an unique environment and has particular working capital needs. Keeping this crucial fact in mind, the company offers innovative and flexible credit products to meet a variety of financial needs. Delivered in an efficient and customer-friendly manner, our short-term business finance is here to help SMEs meet their credit requirement anytime.

SMEs can choose from a host of short loan products that best match their business needs. These include Term Finance, Online Seller Finance, Pay Later Finance, Merchant Cash Advance, Supply Chain Finance and Taxi Finance. Capital Float believes in being transparent in its business transactions and boasts of a wide customer base. B2B service providers, manufacturers, traders, distributors, and aspirational taxi or kirana storeowners are part of Capital Float’s customer base, as its products have helped all these businesses bridge the credit gap comfortably.

There has been a steady growth in the number of small and medium enterprises in the country over the past five years. More interesting, the sector is opening up avenues for tech-driven innovation. However, this flourishing sector still requires substantial monetary support in order to improve its higher global competitiveness over the next five years. Conducive governmental policies along with easy access to finance will greatly enable ease of doing business. In addition, short-term loans for businesses in India, sought through fast, friendly and affordable means, are what will nurture India’s entrepreneurial spirit.

Oct 24, 2018

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List Of Requirements For Taxi Financing

The radio taxi business in India has seen a big boom in the last few years. Whether it’s the number of taxis or users, both have seen an upward swing. Analysts foresee an even higher growth in future. Viable basic fare along with lucrative incentives makes radio taxis an ideal choice for customers and drivers alike. However, using a rented car restricts a driver’s earnings considerably, as they work on fixed salaries. This is where Capital Float’s Taxi Finance steps in as an ideal taxi loan choice for drivers who aspire to have a car of their own and earn more.

Our association with some of the largest taxi aggregators in India makes taxi financing a smart choice for an Uber loan or other kind of taxi loans. It provides an opportunity for drivers across the country to purchase cars and fulfill their dream of becoming microentrepreneurs. Securing a taxi loan from a traditional finance institution or bank can often be a tough task. With multiple evaluations and lengthy procedures, getting a taxi loan successfully from these institutions is a time-consuming prospect. Failing to meet any of their highly demanding requirements can lead to loan rejection. In contrast, Capital Float offers an easy process for procuring a taxi loan with fast processing and minimal documentation.

To successfully avail of a taxi or Uber loan, there are some basic requirements borrowers need to fulfill. If their application meets these requirements, they can get taxi loans like Uber loan and Ola finance surprisingly fast. Here is the list of taxi financing requirements, which are needed for a taxi loan.

1. Down payment: The applicant is required to pay a certain sum as down payment for availing taxi loans. The high down payment required by traditional lenders and banks often deters drivers from owning a car of their own. This is where Capital Float’s taxi financing differs from conventional lenders. Capital Float provides a taxi loan for an easily affordable down payment — one of the lowest in the industry.

2. Valid driving license: Borrowers must have a valid driving license to apply for an Uber loan. Not having one will mean their application could be rejected.

3. Valid taxi permit license/badge: The applicant must have a valid taxi permit license or badge to be eligible to apply for taxi finance. The time period for the taxi permit/badge can vary with lenders. At Capital Float, the applicants need to have a valid taxi permit license/badge that is one year old for new drivers with the taxi aggregators.

4. KYC documents:  To be eligible for taxi financing, applicants need to submit KYC (Know Your Customer) documents at the time of application. At Capital Float, we request minimum documentation and ensure a hassle-free processing of the taxi or Uber loan. The application process for taxi loan at Capital Float happens online. This makes the process more convenient where the applicant can upload the documents directly with minimal paperwork.

Though all of the above are mandatory requirements for getting any kind of taxi loan including Uber loan and Ola finance, there are certain other things the applicant should keep in mind while applying for an Uber loan. This makes it easier for drivers or applicants to pick a lender that suits them the most.

Flexibility in repayment: The repayment of taxi loans can sometimes stretch the borrower beyond capacity with equated monthly payments or EMIs. If drivers have a more flexible option for repayment, it can bring down the pressure of EMIs to a large extent. Capital Float provides a weekly repayment option for taxi loans. This reduces the size of the installments and ensures payments are not carried over/missed. This can be a big boon in a business where daily earnings are dependent on factors beyond the control of the borrower.

Processing fee: Besides having time-consuming and complex processes, traditional banking institutions levy a processing fee. This can vary depending upon the lender and generally tends to be higher in traditional banking institutions. At Capital Float, however, we charge only a minimal amount as processing fee in a bid to keep things transparent and enable our customers.

Ease of application: It’s the age of digitization and online is the preferred channel for an taxi loan application. Capital Float’s taxi loan applications can be made online, require minimal documentation for processing and are disbursed within 3 days.

Hidden charges: Pre-closure charges which are levied by banks and conventional lenders are an additional burden for borrowers. These charges prevent borrowers from closing the loan early even if they can. Capital Float levies no pre-closure charge and borrowers are free to close the taxi loan before the completion of the loan tenure.

Collateral:  Typically, banks tend to sanction a taxi loan if the applicant has substantial collateral, which can be used to recover a bad debt. Capital Float however disburses taxi loans without requesting for collateral, thus improving the chances of many applicants to secure an Uber loan or other taxi financing.

Processing time: Applicants who wish to get a car of their own at the earliest are discouraged by the long time taken to process traditional loans. Due to late loan disbursements, they end up losing valuable business. Capital Float’s taxi financing process is prompt, and funds are credited within just 3 days to enable drivers to start earning at the earliest.

Capital Float’s taxi financing with minimal requirements along with prompt processing makes it an ideal choice for aspiring microentrepreneurs who hope to succeed in radio taxi business.

Oct 24, 2018