India’s education sector is experiencing significant growth, with ed-tech companies playing a pivotal role in the sector’s expansion. As per studies, the education sector in India was estimated to be worth US$ 117 billion in FY20 and is expected to reach US$ 225 billion by FY25. 

However, sustaining a healthy cash flow while striving for growth can be challenging.

In this blog post, we will delve into the top three cash-flow challenges faced by the ed-tech sector and provide expert insights and solutions to overcome them.


Cash flow challenges: navigating personnel, technology, and operational hurdles

Challenge 1: Hiring and managing additional personnel

To effectively expand your customer base, it’s crucial to ensure you have the right staffing in place to manage students. However, the process of hiring new personnel can pose financial challenges, as it requires a significant capital investment for salaries, benefits, and training. To overcome this obstacle, here are some valuable tips to consider:

  • Optimise internal resources: Assess your existing team’s capabilities and workload. Redistribute tasks and provide additional training to maximise efficiency.
  • Prioritise essential roles: Identify key positions that need immediate filling to support customer growth and maintain service quality.
  • Collaborate with freelancers or part-time employees: Hire freelancers or part-time employees to handle specific roles or temporary workload spikes, ensuring flexibility while controlling staffing costs.
  • Collaborate with educational institutions: Partner with local educational institutions to establish internship programs or cooperative education initiatives, tapping into talented students for assistance.
  • Plan for growth: Develop a strategic growth plan that anticipates future staffing needs, enabling proactive preparation and minimising financial strain.

Challenge 2: Technology expansion

Adapting to technological advancements is crucial for your business to stay relevant in today’s digital age. However, investing in technologies such as smart boards, online class setups, and learning management systems can be financially demanding. Here’s how to overcome this challenge:

  • Prioritise technology investments: Assess your business needs and focus on solutions that enhance teaching and learning outcomes while keeping costs manageable.
  • Seek partnerships and grants: Explore partnerships with technology providers and educational organisations offering grants or subsidies for technology adoption. Stay informed about government initiatives and funding schemes supporting technology infrastructure enhancement.
  • Develop a phased implementation plan: Implement technological advancements incrementally, managing costs and ensuring a smooth transition while continuously upgrading your digital infrastructure.
  • Seek funding opportunities: Research and apply for government grants, venture capital funding, or industry-specific initiatives that provide financial assistance for technology adoption.

Challenge 3: Rent and operational costs

Rental expenses and operational costs, including electricity bills, maintenance, repair, etc., can significantly impact the cash flow of educational institutions. These costs are often fixed or subject to annual increases, making it essential to find ways to manage them effectively:

  • Explore cost-sharing opportunities: Collaborate with other educational institutions or organisations to share facilities, resources, or infrastructure, reducing individual costs and fostering mutually beneficial partnerships.
  • Embrace energy-efficient practices: Implement energy-saving measures such as LED lighting, temperature control optimisation, and responsible energy consumption, resulting in long-term cost savings and sustainability.
  • Negotiate lease agreements: Consider negotiating longer-term leases to secure favourable rates or negotiate rent reductions and incentives based on your institution’s needs and market conditions.

Here’s How Razorpay Line of Credit Can Help Ed-tech Businesses Overcome Cash-Flow Challenges

Razorpay Line of Credit for Ed-tech

Razorpay Line of Credit makes it convenient for your business to get instant access to an unsecured line of credit and manage your cash requirements at all times, especially when faced with an unexpected demand. It offers a solution to overcome cash-flow challenges in the ed-tech sector. Here’s how it can assist you:

  • Access flexible funding to cover personnel-related expenses, including salaries, benefits, and training, ensuring you have the necessary staff to manage customer growth.
  • Finance technology initiatives without upfront capital investments, enabling you to adopt necessary technologies like smart boards, online class setups, and learning management systems while managing financial resources effectively.
  • Use the Line of Credit to manage rental expenses, electricity bills, maintenance, and repair costs, ensuring smooth operations and minimising the impact on cash flow.

Also read: 6 Times a Line of Credit Could Help Your Small Business

Here are a few benefits you can enjoy with Razorpay Line of Credit:

✅ Line set up in just 2 business days with 24*7 cash withdrawals

✅ No collateral. No pre closure fees

✅ Interest rates starting at 1.5% per month
Pay interest only on what you use & save on interest by repaying early. For example: If you withdraw INR 100,000 at 1.5% and repay in 20 days, you pay only INR 1000 as interest

✅ Get 100% flexibility & repay in easy EMIs; use your line again without a new application for every withdrawal.



Ashmita Roy is a Brand Marketer at Razorpay. When she’s not working, you can find her strumming her guitar or writing poetry. Dislikes writing about herself in third person, but can be convinced to do so via pizza or cheesecakes.

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