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Flipkart is doing everything to achieve , rolls out easier loans for merchants
Flipkart India’s top online marketplace by sales, Flipkart, is cementing its seller network as it wants to achieve the $10 billion target for GMV by next year.
As Flipkart’s rivals such as Snapdeal and Paytm are leaving no stone unturned to increase their merchants, Flipkart has come out with easy working capital loans to attract sellers.
Flipkart is expanding its loan scheme to all its merchants now and under this scheme, it will give its vendors easier access to loans with basic documentation in 2-5 days.
“One of the biggest problems that our sellers face is that… most traditional banks do not understand the nature of e-commerce business and so they refuse to give out loans without collaterals and high-interest rates,” Manish Maheshwari, head of Flipkart’s seller ecosystem division, told ET.
Flipkart has come up with a credit rating mechanism with which it will assess loan-worthiness of its sellers, which banks and financial institutions can use to sanction collateral-free loans at low-interest rates.
“We add a layer of authenticity and trust on both sides, hence enabling our merchants to gas much as Rs 3 crore of working capital loans to scale up their business. Whatever revenue these sellers get, a part of that directly goes to the bank, so the lender has a comfort that the seller will not default,” said Maheshwari.
As per a report by Goldman Sachs, India’s online retailing market is expected to triple to $69 billion in 2020 from about $23 billion presently.