Payments company PayU has partnered with Kreditech to launch a lending service in India that offers cardless EMIs up to Rs 1 lakh for purchases made online.

The service called Pay U Monedo, is reportedly live on a few e-commerce websites as part of a beta rollout. According to a report on the Economic Times, the service is currently available on and ET reports that PayU has invested $120 million in Kreditech last year.

PayU said Monedo will combine the company’s 3,00,000-strong merchant distribution network with Kreditech’s machine learning-based real-time underwriting and its lending-as-a-service platform. The company said this will allow credit requests to be processed in less than two minutes. A key factor in Monedo will be the kind of interest rates will it charge customers as quick and unsecured loans tend to come with steep interest rates.

PayU claims to cover 90% of the e-commerce sector in India and processes over Rs 90,000 crore of digital payments in the country annually.

E-commerce embraces EMI

No-cost EMIs were introduced by Flipkart and Amazon last year, this allowed buyers to purchase items online and pay for them in installments without incurring any additional costs such as interest or processing fee that is levied when buying via credit cards.

Both companies have tied up with Bajaj Finserve which offers an EMI card for making these purchases. Bajaj Finserv, the market leader in the EMI card segment, claims to have more than 10 million members. Capital First is another major lender in the category and offers an ‘Easy Buy EMI Card’. There are also several emerging online players, such as Kissht, Snapmint and ZestMoney, offering the zero-cost EMI conversion option on online markets, such as Amazon, Flipkart and Snapdeal, to name a few.

An EMI card is a payment instrument that comes with a pre-approved loan amount. Once you make a purchase through this card, you have taken a loan of that amount from the lender. Unlike other loans, you need not provide documents at the time of buying the product. The loan can be paid through EMIs within the tenure of your choice, typically three months to 24 months. The EMI card can only be used at stores that the lender has tie-ups with for offering finance.