Alibaba backed mobile commerce platform, Paytm, has tied up with Aditya Birla Finance Limited to extend collateral free loans to its seller base.
The move comes just after four days since Snapdeal tied up with Tata Capital, which will enable its sellers and online merchants to take a loan.
Renu Satti, VP of SME business at Paytm said, “It is an agreement between a seller and a financing company. The payment towards the loan will be managed through an Escrow account. We will only provide the financing companies with the data on seller performance and create a partner network.”
A collateral free loan offers SMEs an extended arm to build and grow their business. The Ministry of Finance came up with this scheme to support ecommerce companies who can leverage their seller network to help banks and NBFCs identify the Indian SME customer base. Under this scheme banks analyse the promoter team, investor’s profile, innovative idea and revenue visibility to give a loan without asking for collaterals, track record, revenue flow to the company, balance sheet etc.
Prior to this Paytm had tied up with fin-tech startup Capital Float in order to provide working capital to small and medium enterprises.
Welcome to Flash Feed, your essential source for breaking news and innovation from around the web – bite-sized and updated all day.
