Digital Lending for Small Merchants: The Missing Road to the Last Mile

John Arun, Shubhranka Mondal


Lack of affordable credit from formal sources is a key factor hindering the growth of MSMEs in India. This learning note presents insights from Catalyst’s ‘Credit as a Hook’ pilot project. The pilot tested a digital payment and loan product bundle for underserved informal sector merchants in Jaipur, based on the premise that digital payment footprints can help build formal credit histories for this segment.


Learning note

Thematic Area

Financial Well-being and Social Protection