PhonePe-SIDBI pact to fast-track udyam assist

Fintech major PhonePe on Wednesday signed a Memorandum of Understanding (MoU) with the Small Industries Development Bank of India (SIDBI) to provide an end-to-end digital solution through the Udyam Assist Platform (UAP), aiming to empower micro enterprises and merchants across India.

The agreement was formalised in the presence of Union Minister for Micro, Small and Medium Enterprises (MSME), Jitan Ram Manjhi. The collaboration seeks to accelerate the formalisation of Informal Micro Enterprises (IMEs) by enabling them to access Udyam Assist registration digitally. This registration unlocks a range of benefits, including eligibility for government schemes, credit facilities, and integration into the digital payments ecosystem.

PhonePe Lending CEO Hemant Gala said the partnership would support India’s economic vision by extending financial inclusion to the grassroots level. “Through PhonePe’s user-friendly and efficient end-to-end digital solution, we are not just facilitating registration but translating the vision of empowering small and micro businesses into a seamless digital reality,” he said.

The service will soon be available to merchants through the PhonePe Business app, providing them with a convenient avenue to complete Udyam Assist registration.

The Udyam Assist Platform, launched in January 2023 by SIDBI under the Ministry of MSME’s Formalisation Project, has become a key driver in formalising non-GST registered IMEs. According to SIDBI’s Chief General Manager, YM Kumari, the platform has facilitated the issuance of Udyam Assist Certificates to more than 2.75 crore small businesses in just over two years.

The significance of this partnership lies in its ability to bring informal businesses into the formal financial fold. By gaining Udyam Assist certification, micro enterprises can access institutional credit and government-backed schemes, helping them expand and strengthen operations. Additionally, integration with PhonePe’s digital ecosystem will enhance ease of doing business by simplifying payments and registration processes.

For India’s vast micro-enterprise sector, many of which operate outside formal structures, such initiatives are expected to improve financial security, promote entrepreneurship, and support economic growth.