India eCommerce giant Snapdeal has revealed promising news about its new small business financing program. According to the corporation, its Capital Assist service, which aims to raise funds for its sellers, has already raised $8 million for these small companies.
Capital Assist was launched last August, soon after eCommerce rival Flipkart struck its own deal with government groups to boost supplier growth in India, reports said. Capital Assist connects sellers operating on the Snapdeal platform with potential investors from mainstream banks including Axis Bank and HDFC.
In aiding its sellers’ access to working capital, Snapdeal said that the program has led to exponential hikes in sales completed through the site. “We currently have 100K sellers on Snapdeal and are looking to scale this to 250,000 sellers by the end of the year and one million within the next three years,” Snapdeal CFO Aakash Moondhra said. “We realized that SMBs in India face major hurdles in terms of meeting their working capital requirements and raising low cost capital while attempting to grow their business.”
“Capital Assist was launched in order to help our sellers overcome this challenge and we have seen early success towards the launch of this service,” the executive added.
According to reports, Snapeal will now look to fund more than 1,000 of its partner sellers in the next year and will aim to strike deals with 25 banks to secure investors.
Last summer, Flipkart signed a Memorandum of Understanding with the Federation of Indian Micro and Small and Medium Enterprises, and the National Center for Design and Product Development, in a venture that looked to increase manufacturing development across India and support small suppliers with services like data analytics and marketing.
Boosting access to working capital and business solutions for India’s SMEs follows a recent boost in B2B eCommerce startups in India. A flurry of new online marketplaces have popped up in recent months, including BazarA2Z and IndustryBuying.com.