Driving financial inclusion through innovative enterprise financing

• Jul 30, 2025
• 2 min

Micro and small enterprises (MSEs) in India, particularly women-owned businesses, continue to face significant barriers in accessing formal credit. These include limited access to tailored financial products, inadequate working capital support, and a lack of suitable digital financing channels. To address these challenges, MSC supported a high-impact initiative with India’s Principal Financial Institution (FI) for MSMEs to design and roll out digital enterprise financing solutions. The project aimed to unlock access to affordable credit and enterprise support services for MSEs—particularly women-owned enterprises—through technology-enabled, paperless financing models.

A key innovation under this initiative was the design of a digital, invoice-based financing (IBF) product tailored for fair price shop (FPS) dealers. In partnership with the Department of Food and Public Distribution (DFPD), the solution helped FPS owners access working capital credit against verified purchase invoices. This financing mechanism supported the transformation of over 500,000 FPS outlets into Jan Poshan Kendras (JPKs)—nutrition-focused retail points offering affordable, non-PDS food products.

In collaboration with the Principal FI, MSC led the development and pilot of the IBF solution. The product was iteratively tested and refined to address the liquidity constraints of FPS dealers, enable real-time credit access, and integrate it seamlessly with partner platforms. One pilot partner is now scaling the product across states, based on evidence generated through MSC’s engagement.

This initiative contributes to the Gates Foundation’s broader goal of driving inclusive financial access for underserved enterprises. Insights from this project inform future investments and policy efforts to build sustainable, tech-enabled credit solutions for women entrepreneurs and rural enterprises.

The Gates Foundation commissioned this project.