OYO has signed MoUs with the State Bank of India and Bank of Baroda to provide loan to its existing as well as new hotel partners. The company did not share the bracket of the loans, however, it said that the MoUs are signed under the Pradhan Mantri MUDRA Yojana (PMMY)- a government scheme for providing loans up to Rs 10 lakh to the non-corporate, non-farm small/micro enterprises. These loans are classified as MUDRA loans under PMMY and are given by commercial banks, RRBs, Small Finance Banks, Cooperative Banks, MFIs and NBFCs.
OYO has also setup an in-house fintech division, for providing collateral-free loans for its asset partners through banks and NBFCs. The company said that these loans will help individuals in Tier II and III cities to be self-employed and run their own budget assets (two rooms and above) with OYO. Jayant Chauhan, SVP – Fintech, OYO, said that this will help the company to shorten the demand-supply gap of budget hotels.
This also prepares the company to battle with Airbnb, which is eyeing India in a big way. In June, Airbnb signed a memorandum of understanding (MoU) with National Commission for Women (NCW) to enter the tourism sector in the Northeast. The partnership focuses on skill development programmes for women in three states – Meghalaya, Nagaland and Arunachal Pradesh on a pilot basis. The state commissions will initially train a few women on hosting and getting financial assistance from banks, after which their homes will be listed on Airbnb’s platform.
On June 8, Airbnb extended a similar partnership with the Maharashtra Tourism Development Center (MTDC) to start associations with local communities and home-owners. After signing the MoU last year, MTDC said the company has registered 500 homes and it is now targeting 1,500 entrepreneurs for training programmes. The MoU was the first commercial partnership the company signed with a state government. The company will focus on Sindhudurg, Palghar and Ratnagiri districts this year.
Airbnb currently lists 22,000 properties across 100 Indian cities and claims an annual growth of 125% in listings only in India.
Other players providing loans to their partners
According to this ET report, Bank of Baroda has similar MoUs with atleast ten other companies including Amazon, Uber, Lava, Flipkart, Swiggy etc.
In September last year, Amazon India has partnered with Bank of Baroda to offer unsecured micro loans to its sellers ranging from Rs 1 lakh to Rs 25 lakh, with an annual interest rate of 10.45% – 11.5% with lighter documentation.
Online food ordering and delivery platform, Swiggy had tied-up with Indifi Technologies to launch what it calls the ‘Swiggy Capital Assist’ programme, through which it will provide easy access to working capital loans for its restaurant partners. Also, cab players Ola and Uber, both have loan programme in place for their partners.