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Paytm has partnered with Lendingkart, an online lending platform for entrepreneurs and small businesses, to offer collateral free business loans to small and medium enterprises (SMEs) and sellers. With this move, Paytm wants to focus on SME development and expanding its seller base.

The companies claim that the credit evaluation process from Lendingkart will take just 3 days, and that loans will be provided at fair interest rates. The lending platform claims to use big data analytics to assess the creditworthiness of small business owners, with most of the analysis done digitally, enabling loans to be distributed quickly even in semi-urban areas and tier-2 cities.

Flipkart tie up: In September last year, Flipkart Marketplace had tied up with Capital Float and Lendingkart to make loans available for its sellers on its platform. The Flipkart Marketplace mail directed sellers to fill out a simple ‘expression of interest’ form, which required sellers to indicate the expected loan amount (Rs 5 lakh to over Rs 50 lakh), select the preferred loan partner, and provide details about how they would be using the loan.

Lendingkart funding: Lendingkart had raised $10 million from various investors in July this year. At the time, it said it would use the funding for capacity building, its technology platform, adding to its team as well as for an AI big data scoring system. Founded by Harshvardhan Lunia and Mukul Sachan last year, the platform had also raised seed funding worth Rs 3.8 crore earlier this year.

Other lending programmes by ecommerce companies in India:

– In June, Amazon said it would extend its business loan programme to small sellers in India and seven other countries by the end of this year. It is interesting to note that Amazon had signed a memorandum of understanding with State Bank of India in May, to fund transactions and seller’s businesses.

– Snapdeal tied up with Capital Float to launch Capital Assist, which essentially serves the same purpose of providing sellers with easy access to working capital loans.

– As part of its trade facilitation centre (TFC), Chinese ecommerce player Alibaba tied-up with ICICI Bank to provide trade finance and with certification company SGS to provide credit checks and inspections for the TFC. ICICI Bank would also provide business loans, cash management solutions, foreign exchange transactions, bank guarantees and cross-border remittances.