Paytm, owned by One 97 Communications Limited, announced a partnership with Piramal Capital & Housing Finance Limited, to expand distribution of merchant loans to small cities and towns.
This partnership will expand Paytm's loan distribution business, supported by Piramal Finance's wide network of over 300 branches across India. It will also help drive financial inclusion by bringing access to credit to small businesses and retailers. It will offer merchants loans of up to 10 lakh, with a tenure of 6-24 months.
Piramal Capital & Housing Finance Ltd is a wholly owned subsidiary of Piramal Enterprises Limited and an established financial services company in India. Paytm has acquired a large number of merchants from big and small cities across the country, amassing a large base which Piramal Finance plans to leverage and bring ease of credit to small business owners through data-driven underwriting along with credit sanctions based on business income, the release said.
Additionally, this partnership will be expanded soon to include personal loans, where Piramal Finance brings its deep understanding of risk and customer segment. "We continue to see rapid growth across all our lending products, where we empower MSMEs from smaller cities and towns with access to digital credit. The success and scale of our lending products gives us the confidence to expand and further boost our credit offerings. Our partnership with Piramal Finance is another step in that direction, where we will together bring more merchants into the formal credit economy," Bhavesh Gupta, CEO of Lending and Head of payments at Paytm, said.
Jairam Sridharan, Managing Director, Piramal Capital & Housing Finance Ltd., said that his company aims to cater to the lending needs of the merchants in rural markets through a variety of products that are relevant to this core segment. "Many of these merchants are loyal Paytm customers and this partnership will bolster our proposition through a mix of technology and network of branches located in tier-II and tier-Ill towns. Our ability to underwrite this segment and collect in local markets, coupled with Paytm's digital access to this base, we believe we can offer compelling lending solutions," he said.
