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SBI partners with Snapdeal

Update On :27 January 2016

SBI partners with Snapdeal

SBI, India’s largest lender launched SBI e-Smart SME to offer easy working capital to online e-commerce players.

The bank has initially tied up with e-commerce major Snapdeal to offer instant loans to its sellers.

SBI chairman Arundhati Bhattacharya said "The e-commerce growth has created a new ecosystem enabling more than 5 lakh sellers to sell product on digital platform. It has also opened up opportunities for the banking industry.”

SBI E-Smart SME will use data analytics gathered by Snapdeal to assess the sellers credit worthiness, instead of traditional lending based on financial statements like balance sheet and income tax returns. The bank is also planning a similar tie-up with Flipkart, Paytm and Amazon going forward, she said.

"The biggest challenge for SMEs is to raise financing through formal banking is often they don't have collateral or a long history of financial statements to give confidence to lender.

Initially, sellers will be able to avail loans up to Rs 25 lakh. Loans up to Rs 10 lakh will be collateral free with a competitive interest rate. Women entrepreneurs will have a special concession of 25 basis points.

Loans below Rs 10 lakh will be covered under the Pradhan Mantri Mudra Yojana Scheme. The bank had hired management consulting firm BCG to facilitate the development of this credit model.

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