Amazon Offers Loans To Indian Sellers

Amazon India announced on Wednesday (June 13) the launch of its Seller Lending Network, providing merchants on Amazon.in loans from third-party lenders.

According to a report in The Hindu, the move expands on the Seller Lending program that the online retailer launched in 2016. Amazon said that with the new network, merchants will have more choices when it comes to lenders and loan types. The report noted that sellers on Amazon India could save roughly 150 to 250 basis points of interest rates, because the lenders will be competing for their business.

Sellers will be able to get the loans by applying online and providing little in terms of documents. Some of the perks include a quick loan approval process that will take between two and three days, and approvals for renewals of existing loans within the same day.

“What we wanted to remove is a lack of working capital [for sellers] as a reason not to start selling online. We started this programme in 2016. Two years later, we noticed there is an opportunity to make this programme even better,” said Gopal Pillai, general manager and director, seller services, Amazon India in the report.

In addition to the Seller Lending Network, Amazon is also launching Lender Central, which is a portal for lenders to exchange information with Amazon. The information shared will include seller performance data, loan application status and loan portfolio information. Lenders will also have the ability to track the seller’s performance in real time, which should create a more in-depth loan decisioning model.

“We have a very proven algorithm that predicts the seller’s capability to repay based on their historical performance,” said Pillai in the report.

Amazon India launched in June of 2013 with only a few hundred sellers. Since then, the platform has exploded, currently boasting more than 340,000 sellers offering more than 170 million products on the eCommerce website.