Country’s Largest Lender, SBI, Partners with Snapdeal to Offer Loans to E-Commerce Sellers
India: State
Bank of India, largest lender of the country, is launching SBI e-Smart SME, in
partnership with one of the e-commerce major, to offer convenient working
capital to e-commerce players.
The bank has tied up with
Snapdeal to offer instant loans to its sellers.
SBI E-Smart SME will use data
analytics gathered by Snapdeal for the assessment of the seller’s credit
worthiness, rather than following traditional lending based on financial
statements like balance sheet and income tax returns.
Snapdeal have created a new
real-time analytics tool with SBI, through which they can assign a credit score
to all sellers on its platform. Previously, Snapdeal had lent over INR 250
Crore to more than 1,000 sellers through its Capital Assist Program and now,
after partnering with SBI, it is targeting to disburse loan amount of INR 1,000
Crore to SMEs.
SBI e-Smart SME will help the
sellers will be able to avail the loans up to INR 25 Lakhs and there will be a
special concession of 25 basis points for women entrepreneurs.
SBI has hired Boston Consulting
Group, a management consulting company, to develop this credit model.
According
to TechSci Research growing e-commerce industry has built a new market space
of more than 5 Lakh sellers to sell their products on digital platform. This
initiative would open the market opportunities for the banking sector as well.
The biggest challenge the SMEs
faced to raise funds through formal channel is a long history of financial
statements or collaterals to give confidence to the lender. This
initiative of SBI and Snapdeal will allow e-commerce players to raise funds in
a hassle-free manner.
According to a
report published by TechSci Research “India
E-commerce Market Forecast & Opportunities, 2020” the country’s
e-commerce market is projected to grow at a CAGR of more than 36% during
2015-2020. This initiative will act as one of the biggest growth drive for
e-commerce market in India.