OfBusiness Revolutionizes SME Growth with Smart Financing and Raw Material Procurement
In the backbone of India's economy, Small and Medium Enterprises (SMEs) face two perennial hurdles: high raw material costs and a lack of accessible credit. Nitin Jain, the Co-founder of OfBusiness, is tackling these challenges with a unique "Commerce-plus-Finance" model. By leveraging technology to aggregate demand and providing low-cost credit through their NBFC arm, Oxyzo, OfBusiness is not just a marketplace—it's a growth engine for Indian manufacturing.
The SME Dilemma: The Cost of Inefficiency
Nitin's journey began with a deep dive into the real problems faced by manufacturers. An IIT Delhi Computer Science silver medalist with a background at the Royal Bank of Scotland, Nitin realized that SMEs were paying a massive premium for raw materials. "An SME pays 3-4% per month more than a large player for the same material because they buy in small quantities from local distributors," Nitin explains.
Furthermore, when these SMEs look for credit to finance their working capital, they are often turned away by traditional banks or forced to pay exorbitant interest rates. This double-whammy of high costs and high interest suffocates growth. OfBusiness was founded in 2015 to break this cycle.
The OfBusiness Model: Commerce + Finance
OfBusiness operates as a B2B aggregator. They aggregate demand for raw materials like steel, chemicals, and agri-products from thousands of SMEs. This allows them to negotiate directly with massive manufacturers like Vedanta or JSPL at bulk rates.
The Dual Value Proposition
- Procurement: Buying at bulk prices and passing the savings to SMEs, effectively dropping the raw material cost by 2-3%.
- Financing: Through Oxyzo, providing unsecured, low-interest working capital loans specifically for these purchases.
By integrating the purchase and the financing, OfBusiness removes the "middleman" friction. They don't just give a loan; they provide the actual material the SME needs to start production, ensuring the capital is used productively.
Scaling with Profitability in Mind
Unlike many tech startups that prioritize growth over profits, OfBusiness has been laser-focused on unit economics from Day 1. Nitin emphasizes that the difference between an SME and a "Startup" is often the capital structure. "Traditional businesses have plants and machinery; they are asset-heavy. Startups are asset-light. We wanted to combine the scalability of a tech platform with the robustness of a traditional business."
OfBusiness Impact
- Raw Material Savings: Reducing costs for SMEs by buying directly from manufacturers.
- Credit Access: Providing credit at interest rates that are 20-30% lower than local informal lenders.
- Scale: Fulfilling thousands of orders across diverse commodities from metals to textiles.
The Entrepreneur's Journey: From London to India
Leaving a high-paying job at RBS in London to start from zero in India was a significant shift. Nitin recalls the early days of confusion and excitement in 2015. "Starting from zero facing failure every single day... that is the real learning," he shares. His motivation wasn't just to build a company, but to create something that does justice to his own potential and solves a systemic problem.
Lessons for Founders
- Execution is Everything: "There were many facebooks before Facebook. The winner is the one who executes best."
- Solve Real Problems: Don't just follow trends. Spend time in the market talking to suppliers and buyers to find the real gaps.
- Focus on Team: Nitin credits his co-founders' complementary skills—from technology to finance—as the secret to their speed.
- Embrace Momentum: Remove distractions and keep the momentum going. Once you get moving, the obstacles become easier to overcome.
Future Vision: The World's Largest SME Platform
Nitin's vision for OfBusiness is to become the world's largest platform for SMEs, integrating everything from aggregation and tendering to financing and capacity utilization. By using technology to increase the capacity of the manufacturing sector, OfBusiness is helping realize the "Make in India" dream.
His advice to young entrepreneurs is simple: "India is sitting on a gold mine of opportunities. Start your journey, believe in yourself, and you will make a difference."