Godrej Finance has launched a Supply Chain Finance (SCF) business to expand its MSME lending franchise, according to reports from ETSupplychain. The company, which operates as a subsidiary of Godrej Capital, aims to build a ₹6,000 crore SCF portfolio over the next five years. The new business is expected to contribute 8% to Godrej Finance's overall Assets Under Management (AUM) as part of its strategic expansion. As reported by ETSupplychain, the initiative addresses the ongoing working capital constraints faced by MSMEs despite increasing formalisation of supply chains through GST-led digitisation and digital financial infrastructure.
The SCF offering features loan ticket sizes ranging from ₹10 lakh to ₹25 crore, designed for businesses operating within supply chains of large anchor corporates. According to ETSupplychain, the business targets companies with annual revenues ranging from ₹500 crore to over ₹1 lakh crore, spanning BBB to AAA rated companies. The new business will provide working capital finance through Dealer Financing, Vendor Financing, Purchase Invoice Financing and Sales Invoice Financing to support anchor corporates, dealers, vendors and suppliers. The platform offers a digital process covering customer onboarding, underwriting, loan disbursement and servicing, while using transaction-led data and end-use monitoring to support credit decisions.
Unlike traditional collateral-led lending models, the SCF offering is underpinned by cashflow and transaction-based underwriting, enabling businesses to unlock working capital against genuine trade activity. As reported by ETSupplychain, this approach allows the company to serve a broader range of businesses while maintaining risk management standards. The platform uses transaction-led data and end-use monitoring to support credit decisions, enabling faster financing access through a seamless digital experience. The company is currently engaging with more than 30 anchor corporates across captive and non-captive ecosystems as part of its expansion strategy.
As part of its long-term roadmap, Godrej Finance plans to expand its Supply Chain Finance proposition through factoring, reverse factoring and participation on the Trade Receivables Discounting System (TReDS), as reported by ETSupplychain. These additions are expected to improve MSMEs' access to credit and strengthen the working capital ecosystem. The company aims to support MSMEs with value-added services that help build more resilient, capable and future-ready businesses, with the initiative being launched through Godrej Capital's financial services arm serving as the strategic framework for this supply chain finance initiative.
