Bank of Baroda partners with Amazon.in to provide lending support to SMEs
Bank of Baroda partners with Amazon.in to provide lending support to SMEs
To be Amazon’s exclusive partner for micro-lending program offering loans as small as INR 1 lac.
Alliance to be forged further with Baroda ECOM loans (BEL) up to INR 25 Lacs.
Sudhakar Reddy has been a seller on Amazon India for a long time but sourcing loans to grow his
business had been challenging. Further, due to his limited credit history- lenders asked him for heavy
documentation and offered very high interest rates, which made it very difficult for him to get loans.
This new initiative has come as a boost for his business and has been helpful to buy more inventory in
time for upcoming Diwali season. In comparison to industry standards, this loan facility was provided
with much lighter documentation and within a few working days, whereas it usually takes around one
month. Most importantly, the rate of interest was very low, helping him maintain margin on his business
too!
announced an alliance with the country’s 2 nd largest public sector bank, Bank of Baroda to extend loans
to its sellers. Under this alliance, Bank of Baroda will support micro, small & medium businesses on
Amazon.into get fast and easy access to working capital at highly competitive interest rates in a short
span of 3 to 5 days. In July, Amazon piloted its Micro-Lending FacilitationProgram in exclusive
association with Bank of Baroda. Out of total sanctions under this program, 40% of the beneficiaries are
new to credit. With the initial success of the micro-lendingfacilitationprogram, this association will now
beexpanded with Bank of Baroda offering ECOM loans (BEL) up to Rs 25 lakh to more sellers that have
been selling on Amazon India marketplace and performing consistently.
In India, unsecured loans of INR 1, 00,000-INR 25, 00,000 have very low approval rates and the small-
scale businessesget loans at high annual interest rates between 18% - 30% with a processing time of up
to 30 days. In addition, small businesses have to go through heavy documentation and due diligence to
get loan approvals. Under this program, with the help of Bank of Baroda’s simplified process, eligible
sellers on Amazon.in will be able to get a line of credit facility at annual interest rates of 10.45% -
11.5%with lighter documentation and fast loan approval. Through this overdraft facility, sellers will get
the flexibility to expand their business without having to worry about EMIs and repayments and can get
the online sanction even without visiting the bank.
Speaking on the partnership, Mr. P.S.Jayakumar, MD & CEO, Bank of Baroda said, “We clearly
understand the specific needs of SMEs for ecommerce business and are proud to partner with Amazon
India to provide comprehensive banking solutions to their 2 lakh+ seller base. To address the e-
commerce seller specific pain points of no credit history, weak financial history, lack of adequatedocumentation, we designed the Baroda ECOM loan product (BEL) which moves the lending paradigm
from Balance Sheet to Flow based.”
Talking about the Program, Mr. Gopal Pillai, Director & GM, Seller Services, Amazon India said
“Through our constant engagement with sellers, we realized that the lack of financial resources can
hinder the growth of small businesses as they scale up which can impact their expansion, especially
ahead of spike sale events during Diwali. With this associationwith Bank of
Baroda, we aim to help them overcome the barrier of access to capital and enable them to grow their
business on Amazon.in and make the best of the festive season. We have made the end to end process
quick and convenient allowing our sellers to focus on their core business while we take care of providing
them with hassle-free financial solutions. Like always, we work seller backwards and try and resolve all
their hurdles to ensure a seamless selling experience.”
Sellers on Amazon.in will receive pre-approved indicative offers from Bank of Baroda on their dashboard
on Amazon.in’s Seller Central outlining the loan amount they are eligible for and the associated interest
rate and service fee. They can then fill out a quick 10 minute application form. Sellers will receive the
final loan approval decision within 2-3 working days of submitting relevant documents online.Sellers will
be able to use their sales disbursements on the Amazon marketplace to directly repay the loan.Bank of
Baroda has developed the innovative product BEL based on alternative profiling basis surrogate data
points such as ID, contact-ability, intent, ability, stability using alternative social media data. Bank of
Baroda simplified profiling is further augmented by bureau analysis and digital analysis of bank
statements.
Currently, loans are offered on an invite-only basis for the marketplace sellers who qualify against
various criteria including account tenure, seller’s selling history (which takes into account a minimum
tenure, and minimum sales volume), customer feedback and compliance with Amazon and Bank of
Baroda’s policies and guidelines.
About Bank of Baroda
Bank of Baroda is an Indian state-owned International banking and financial services company
headquartered in Vadodara (earlier known as Baroda) in Gujarat, India. It is the second largest bank in
India and has corporate office in Mumbai. Bank of Baroda is a pioneer in various customer centric
initiatives in the Indian banking sector. Bank is amongst first in the industry to start technology and new
business initiatives.
Bank has a long legacy and tradition of contributing actively to the social and economic development of
the communities in which it operates through various development activities in the realm of education,
health, human welfare and other social activities. Bank of Baroda always transcends from business
interest and reaches out to weaker section of society, with a view to make a meaningful difference to
them.
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