NBFC-Factor 121 Finance has crossed ₹10 crore in cumulative loan disbursements through GeM Sahay, the credit facility integrated with the Government e-Marketplace (GeM), strengthening access to working capital for micro, small and medium enterprises (MSMEs) supplying to government buyers.
The company said it has disbursed more than 2,600 loans to over 400 MSMEs across 173 cities in 27 states, enabling businesses to access collateral-free financing against confirmed government purchase orders.
Scaling MSME credit through GeM Sahay
Built on the Open Credit Enablement Network (OCEN), GeM Sahay allows eligible MSMEs to secure short-term working capital loans in minutes using transaction data linked to government procurement orders.
121 Finance was the first lender to go live on the platform and continues to be the largest lender operating through GeM Sahay.
The company has focused on addressing small-ticket financing requirements that are often overlooked by conventional lending institutions.
Financing even the smallest credit needs
A key feature of 121 Finance’s model is its collection-controlled lending approach, where loan repayments are linked directly to cash flows generated from government purchase orders. This structure enables faster underwriting, improves repayment visibility and reduces credit risk.
The company said its technology infrastructure has been built to efficiently handle high-volume micro-ticket transactions, making it possible to underwrite and disburse loans as small as ₹127.
According to 121 Finance, the achievement demonstrates how digital public infrastructure can support formal credit access even for the smallest financing requirements.
OCEN enables cashflow-based lending
121 Finance Founder & Managing Director Ravi Modani said India’s MSME sector requires financing solutions aligned with business cash flows rather than traditional collateral-based lending models.
“GeM Sahay demonstrates how digital public infrastructure and OCEN can make formal credit accessible to even the smallest enterprises,” Modani said.
He added that the company’s expertise in technology-enabled factoring and cashflow-based lending has helped it develop scalable financing solutions tailored to MSME business cycles.
GeM ecosystem creates a large financing opportunity
According to GeM data, the government procurement platform crossed ₹5 lakh crore in Gross Merchandise Value (GMV) during FY25 and has recorded cumulative transactions exceeding ₹18 lakh crore since inception.
The platform currently hosts more than 11 lakh registered MSMEs, creating a significant opportunity for embedded, transaction-linked financing solutions.
Industry experts believe the growing scale of government procurement is creating new opportunities for cashflow-based lending models that leverage verified transaction data.
GeM Sahay showcases OCEN at scale
Industry stakeholders have highlighted GeM Sahay as one of the first large-scale demonstrations of OCEN-enabled lending in India.
Sagar Parikh, Core Volunteer at iSPIRT, said the platform demonstrates how transaction-linked underwriting and controlled repayment mechanisms can expand credit access while maintaining portfolio quality.
Rahul Bhaik, Volunteer at iSPIRT, described GeM Sahay as one of the country’s first large-scale implementations of cashflow-based lending, showing how verified transaction data can enable loan approvals and disbursements within minutes.
Eyeing expansion beyond GeM
Building on the experience gained through GeM Sahay, 121 Finance is exploring opportunities to replicate similar purchase-order-linked financing models across other government procurement ecosystems.
The company believes expanding transaction-based financing solutions can further strengthen MSME growth, improve financial inclusion and widen access to formal credit across the country.