The mailer sent out by Flipkart Marketplace directs sellers to fill out a simple ‘expression of interest’ form, which requires 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 – to buy inventory, to improve infrastructure, to add new brands or any other reason. Sellers also need to sign a formal agreement.
Following this either Capital Float or Lendingkart will get in touch with the seller to process the loan and provide them further details like interest rates, says the mailer.
According to a presentation linked to the mailer, Capital Float will offer working capital loans of up to Rs 1 crore, with flexible tenures of 30-180 days. It also claims that once the loan is approved the funds will be released within 24 hours. However, no details regarding Lendingkart’s offer have been furnished.
It’s worth noting that last month Snapdeal had 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 indicated by this The Economic Times report. Amazon had also started a similar program called Amazon Lending back in 2012. However, it isn’t clear if this service is available to sellers in India or not.
Capital Float funding: The Bangalore-based digital SME finance company has been on a funding overdrive this year. Last month it had raised $1 million from SAIF Partners, barely a month after it had raised $2 million from Aspada Investment Company. Capital Float had also raised an undisclosed amount of angel investment earlier this year.
– In a bid to increase the number of sellers on its marketplace, Flipkart signed an MoU with the Textile Ministry last month that will see Flipkart listing products from rural Indian handloom weavers and craftsmen on its platform.
– This tie-up is quite similar to Flipkart’s MoU with FISME (Federation of Indian Micro and Small and Medium Enterprises) and NCDPD (National Center for Design and Product Development) in June this year. Flipkart had mentioned that it will be listing products from 50,000 SMEs as part of this initiative.
– In July, Flipkart raised $1 billion investment from existing investors Tiger Global and Naspers, with participation from Singapore government’s sovereign wealth fund GIC, DST Global and Accel Partners.
– The company had raised $210 million from DST Global and existing investors Tiger Global, Naspers, and Iconiq Capital in May this year, and $360 million from Dragoneer Investment Group, Morgan Stanley Investment Management, Sofina, Vulcan Capital, and Tiger Global late last year.
– Earlier in May Flipkart had acquired online fashion store Myntra and had stated plans of investing upward of $100 million into Myntra in the near future. Post acquisition, Myntra CEO Mukesh Bansal had joined Flipkart board and is now heading Flipkart’s fashion business.