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India’s leading e-commerce marketplace Flipkart has partnered with SMEcorner, an online financing platform for SMEs (small and medium enterprises), to assist sellers on its platform avail loans from banks and NBFCs (non banking financial companies) without the hassle of dealing with middlemen.
The partnership, inked last week, has already attracted a large number of active sellers from Flipkart to apply for loans on SMEcorner.com . “There are many websites that offer personal/retail loans, mortgages, credit cards, etc, but none that offer SMEs an online platform to apply to banks/NBFCs for loans. Given the large number of SME sellers on e-commerce websites, we launched SMEcorner.com, aimed at arranging finance for the e-commerce ecosystem.
Besides Flipkart, we also look to tie-up with other e-commerce sites, large B2B portals and SME chambers,” Samir Bhatia, founder & CEO, SMEcorner.com told BusinessLine .
Gap in financingA huge gap exists in debt financing in the SME sector, which SMEcorner.com is looking to bridge.
“According to data collected by the International Finance Corporation (IFC), around 41 per cent of SMEs in India do not have access to bank loans or other related products offered by financial institutions. IFC reports a financing demand gap of ₹2.93 trillion in the SME sector,” pointed out Bhatia. SMEcorner.com offers four kinds of loans – loan against property, working capital loan, unsecured business loan and loan for medical equipment.
Explaining how it works, Bhatia said, “When sellers on Flipkart require financing, the company refers them to us. Sellers can access the Flipkart button on our website and apply for a loan online by filling in details. After a preliminary credit analysis to figure out the seller’s credit-worthiness, we send the application to all our partner banks and NBFCs. The chance of getting a loan is much higher this way,” said Bhatia, who has partnered with 8 financial institutions.
No fees“Unlike middlemen, we do not charge a fee to the SME sellers but get paid by the financial institutions for our services. We are looking to partner with many more financial institutions” said Bhatia.
At present, Flipkart has 5,000 sellers on board, of which 50 per cent are SMBs. Having partnered with FISME (Federation of Indian Micro and Small and Medium Enterprises and NCDPD (National Centre for Design and Product Development), Flipkart is looking to attract 50,000 SMBs to sell on its platform by August 2015.
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