Amazonian India has in partnership with Bank of Baroda offer its sellers unsecured microloans ranging from Rs 1 lakh to Rs 25 lakh. The company says the seller will get the line of credit in a short period of three to five days with an annual interest rate of 10.45% to 11.5% with lighter documentation.
Apparently, getting loans traditionally in this range takes about 30 days and charges annual interest rates between 18% and 30% currently. The alliance is part of Amazon’s microcredit facilitation program, which was begin two years ago for its salespeople.
Amazon said in a statement that the program is open to all sellers on Amazon’s platform, including those who are also present on other e-commerce platforms, and 100 sellers have already entered the program. .
Bank of Baroda expects the program to achieve a 20% penetration rate among sellers on the platform within the next year, the statement said. PS Jayakumar, chief executive and CEO of Bank of Baroda, said in a statement that the tie is part of the bank’s dedicated e-commerce offering. Baroda ECOM (BEL) loan product, which aims to facilitate the lending process in this sector.
It appears the bank is bullish on smaller sellers, as reflected in its financial results for the first quarter of fiscal 2018, that 20% of its global loans portfolio accounts for micro, small and medium enterprises (MSMEs).
How it works
Note this, the program is as now available on by invitation only, as sellers on Amazon.in will receive indicative pre-approved offers from Bank of Baroda on their dashboard with the amount of credit they are eligible for and the associated interest rate and service charges. Amazon said that to take advantage of the offer, the seller will complete a 10-minute application form and receive the final loan approval decision within 2-3 business days of submitting the relevant documents online. Approval will be given based on the seller’s sales history (which takes into account a minimum tenure and minimum sales volume), customer feedback, and compliance with Amazon and Bank policies and guidelines. of Baroda. BEL will also examine the seller’s eligibility for a loan based on alternative profiling based on data points such as identity, contact ability, intent, ability, stability using alternative social media data, as well as digital analysis of bank statements.
In addition, sellers will be able to use their disbursements from sales on the Amazon marketplace to directly repay the loan.