Paytm offers unsecured loans to small businesses, Mobikwik to follow suit
Paytm wants to prise the vice-like grip of banks away from local moneylenders over the loan business. The mobile wallet company, which aspires to become a digital bank, has started offering unsecured loans to merchants such as the neighbourhood grocer or the mobile recharge shop or the auto driver, who use the wallet to accept offline payments.
“This is for all those who cannot get a loan from the bank because they do not have a credit profile,” said Kiran Vasireddy, Sr. VP, Paytm. Gupta is one of the 20-odd merchants who have taken such a loan in the last one-week since Paytm started offering it.
Gupta’s mobile recharge shop in Pitampura, West Delhi has a monthly turnover of Rs 2 lakh, and he needed Rs 25,000 to increase inventory. The loan was processed in two hours, said Gupta. “A bank wouldn’t have given me this loan, and the documentation process is harrowing,” he said.