Tag: BNPL

PCHFL and API Holdings partner for financing solutions in healthcare

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Piramal Capital and Housing Finance Limited (PCHFL) has partnered with API Holdings through its digital platform Retailio to provide financing solutions to consumers, retailers and merchants in the API Holdings’ healthcare ecosystem.

Retailio is the country’s largest digital B2B healthcare platform.

Under this partnership, PCHFL has earmarked an initial amount of ₹100 crore for disbursement by March 2022, it said in a statement on Thursday, adding that the amount could be increased based on the initial market response.

BNPL solution

Further, PCHFL will provide solutions like Buy Now Pay Later (BNPL) for consumers and merchants, multi-collateral loans for retailers, supply chain financing, hospital financing, invoice discounting, among others.

Jairam Sridharan, Managing Director, PCHFL said, “This partnership is in is line with our strategy of expanding our retail portfolio through a mix of collaboration-led origination model and leveraging our distinguished digital lending capabilities. We look forward to a profitable and long-term partnership with API Holdings.”

With the acquisition of DHFL, PCHFL has become one of the leading players in the retail lending segment with access to over 10 lakh customers, presence in 24 States with a network of over 300 branches.

Also read: After DHFL buy, focus is now on implementation: Ajay Piramal

“By bringing together our potential synergies, we aim to provide capital to the underserved SME and MSME segment that would in-turn help fuel growth for these businesses,” said Harsh Parekh, Whole-time Director and Co-founder, API Holdings said.

API Holdings also has presence in Thyrocare and Akanamed, and through its subsidiary, owns the PharmEasy brand along with the proprietary technology platform which powers the PharmEasy marketplace

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OkCredit report, BFSI News, ET BFSI

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– Anushka Sengupta

More than 30 lakh customers came forward to settle their credit this festive season. Credit given per active merchant went up by 23%, a report by OkCredit revealed.

The oldest form of ‘Buy Now Pay Later‘ has been a part of the small and medium sized businesses space, where customers who buy from local stores do not pay upfront, but pay later. These merchants usually keep an account for their customers, and the customers repay the bills later.

Such merchants added 1 million customers during the period, repayments were up 12% than average, and merchants booked 15% growth during the two-week festive period, it said.

Digital payments have played a huge role in helping mom and pop stores recover credit. As per the report, the number of credit lines settled digitally have gone up by 100% since last year, showing adoption of online payments in digital book keeping. There has been a 70% increase in retail small and medium sized businesses adopting a digital solution to manage their books.

Merchants in eateries, school supplies, travel, jewellery and kirana shops saw the highest growth. On an overall basis, transactions have grown by 20% compared with the festive season a year ago.

Each merchant category on OkCredit has seen an increase in customers. The most significant growth has been witnessed by retailers in the following categories :-
1) School supplies and stationary – 39%
2) Travel agencies – 26%
3) Eateries – 25%
4) Gold & Jewellery – 17%
5) Electronics – 12%

BNPL sees surge in repayments this Diwali season : OkCredit report

The increased repayments and growth in retail small and medium sized businesses (SMBs) also point to a healthy recovery in the economy, especially in tier-2 and tier-3 towns, as these towns account for a significant chunk of OkCredit’s merchant base, the report said.

Gaurav Kunwar, Cofounder & CPO at OkCredit says, “We wanted to measure category-wise impact of the Diwali shopping season among retail SMBs.
It was heartening to see credit recovery being high, in places such as Kerala, Tamil Nadu, Manipur, it was 30% higher than rest of the country.”

BNPL sees surge in repayments this Diwali season : OkCredit report

Merchants in states such as Kerala and Karnataka have seen 8% growth in business. The North-Eastern states have seen the highest growth, topped by Manipur where transactions per merchant increased by 22%.



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BNPL- A boon or a bane for millennials?, BFSI News, ET BFSI

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-Anushka SenguptaDebaditya Ghosh, a senior software developer at Deloitte, affirmed that he will not use BNPL again. Yes, the ‘Buy Now Pay Later’ credit option has its benefits, such as no hidden charges, but millennials like Ghosh said they are not able to control their expenditures.

“I don’t think I will use it again in the near future. The reason behind it being the purchase limit set by the e-commerce entity. For Amazon the limit is Rs 7,500-10,000. I purchased a product worth Rs 16,000, and I got tempted by the no interest rate policy, so I opted for the BNPL option. However, this wasn’t necessary and I wasn’t planning to spend the additional Rs 6,000. But temptations are quite high, which in turn makes you overspend. You start using it even for small purchases and, at the end, you are burdened by a lot of debt,” Ghosh said.

BNPL is a short term financing method, which allows one to make purchases and pay it off in instalments, within the given stipulated time period.

For those who are known to spend their earnings lavishly, and have fallen short in making full payment at the time of purchase, BNPL can be a great option, but it can increase their already-fragile financial burden.

“I always prefer buying using debit or credit because I can opt for deferment of high value purchases by staggered payments, when needed,” said Shreyashi Haldar, final year MBA student of NIBM Pune.

However, the less conservative millennials – the ones who are spend thrift – believe that BNPL is better than EMI, because of the 0% interest rate. BNPL companies offer an interest rate of 0-24%, depending on the transaction amount, and give the option of digital KYC.

“I purchased an item using Amazon’s BNPL facility, even though it had the EMI option. For EMI, I was being charged 13-15% interest, but with Amazon’s BNPL option, I could purchase the item at 0% interest,” said Asmita Sengupta, senior analyst at PWC India.

For EMIs, one has to pay a percent of interest, some charges, and some paperwork is also required.

Although millennials are in two minds about which is better – one thing is for sure – they believe that BNPL will not replace EMIs or credit cards, in line with what the industry believes. One of the main reasons for this is because the purchase limit is higher in EMIs, compared with BNPL.

“From what I have noticed, BNPL facility of e-commerce platforms are available for customers on that platform only. For example, I had purchased some items using Flipkart’s BNPL facility, but I could only buy it from Flipkart. But with my EMI card, I do not face this issue,” Haldar said.

BNPL- A boon or a bane for millennials?
Since BNPL is relatively new, BNPL is yet to garner a greater reach, like that of EMI and credit cards. Though millennials seem to be in two minds about this new and emerging credit option, the industry believes that the demand for it will likely rise in the future – especially after its robust performance this festive season.

Also Read : Buy Now Pay Later not just a festive craze, demand likely to rise



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Visa, Mastercard hop on for ‘Buy Now Pay Later’ ride, plan launch in India by end of FY22, BFSI News, ET BFSI

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Global card networks Visa and Mastercard plan to launch their respective Buy Now, Pay Later (BNPL) platforms in India by the end of FY22, three top industry executives aware of the developments told ET.

BNPL is a credit option that gives customers at storefronts and on ecommerce pages the option to defer payments free of cost or to convert the transaction value into equated monthly installments (EMI). The facility is provided by financiers even to those without credit cards.

Visa and Mastercard are reportedly scouting for partners to set up platforms that would facilitate retail brands and online merchants to directly tie up with banks and offer their customers various payment options, the sources cited above said.

“BNPL platforms by both Visa and Mastercard are in the works, and it makes complete sense as they have a goldmine of customer data to create platforms for banks looking to enter this space,” said the chief executive at a large private bank. The executive didn’t want to be named.

Both Visa and Mastercard have approached major card-issuing local banks on their respective networks with product propositions. Visa is also said to be in talks with one or more payment gateways for a strategic tieup, sources added.

Visa and Mastercard didn’t respond to ET’s queries on the subject.

At present, this service is offered by startups such as ZestMoney, Capital Float, PayU’s Lazypay as well as Pine Labs and Paytm. The market has seen significant traction over the last two years with millions of Indians taking to online shopping through the pandemic.

Global Templates
The move is in line with Visa and Mastercard’s BNPL forays in various international markets. Last month, Mastercard announced the launch of a new BNPL platform in the US, the UK, and Australia across its acceptance networks. This comes at a time when global fintech companies, such as Square, PayPal and Klarna, are betting aggressively on this segment.

Mastercard believes that BNPL could lead to a 45% increase in average sales from existing relationships and a 35% reduction in cart abandonment, a source briefed on the matter told ET.

Visa, too, has launched BNPL initiatives in markets such as Canada and Malaysia and is reportedly setting up a global BNPL vertical to oversee the development. According to a source, a top executive in Visa’s South Asia team could head this vertical, although ET couldn’t independently verify the proposed appointment.

As per industry insiders, the typical model would involve a financier tying up with a merchant and a platform for a fixed transaction fee. As there is no interest rate, the facility is offered to customers with a Merchant Discount Rate – or a transaction service rate – of around 1.5%.

The moves are seen by industry insiders as an attempt by the US card companies to gain first-mover’s advantage in India’s nascent online instalment payments market.

Another source involved with the talks said that the plans were finalised after the Reserve Bank of India (RBI) announced stringent card data storage norms. The new rules set to kick in from 2022 will prohibit merchants from storing card data of customers, which could significantly hamper their ability to offer customised discounts and EMI options.

“From January, the credit card market is expected to shrink due to the new rules that restrict merchants from storing card details,” said an executive cited above. “For the large payment operators, BNPL allows an opportunity to use scale.”

Over the past four years, the National Payments Corporation of India (NPCI)-owned solutions such as Unified Payments Interface and Bharat Bill Pay have helped increase the adoption of digital payments in the country.

Banks Willing to Underwrite Risk
Through the festive season, top consumer Internet companies, including Flipkart, Amazon, Paytm and Byju’s, are offering BNPL services to customers. The premise is simple: Millions of Indians who took to online shopping amid the Covid-19 pandemic are opting for interest-free credit at checkout points on online platforms. Banks, too, are willing to underwrite the risk.

Industry insiders say the size of India’s annualised BNPL market in gross transaction value terms has grown to around $1.5-2 billion in less than 18 months, from just a few million dollars in 2019.

At the backend, these transactions are enabled through network integrations involving retail marketplaces, merchants, and financiers. The model is also applicable to offline outlets, where Bajaj Finance is among the leading players.

Typically, they are “form-agnostic” and can be enabled after the customer’s credentials are authenticated at checkout points. Hypothetically, such transactions can be done without any payment instrument, using just an ID card. Moreover, the repayment contracts are flexible, depending on the credit scores of customers.

Fintech companies typically rely on SMS data and credit scores to gauge income and repayment rates for underwriting. A loss is typically taken on the books of the NBFC or the banks. While default rates for BNPL in India are not in public domain, as per sources, the industry bounce rate hovers between 15% and 20%.



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Mobikwik sees ‘BNPL’ as its fastest growing business segment

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IPO-bound One Mobikwik Systems (Mobikwik) sees it’s ‘Buy Now Pay Later’ product — which enjoys higher margins — as a major growth driver and it’s fastest growing business segment in the days to come, said Co-founder Upasana Taku.

This digital financial services firm is also aiming to launch its ₹1,900 crore initial public offering (IPO) by this month end, Taku told BusinessLine in an interview.

Growing market

The ‘Buy Now Pay Later’ (BNPL) product allows consumers to pay later in instalments with no additional costs for their purchases.

Also see: Meet the 31 start-ups most likely to become unicorns soon

It is a growing market in India and, over the last eighteen months, has expanded from a level of a few million dollars annually to about $1.5–2 billion in total transaction value.

“We see BNPL as a major growth driver in the days to come. All metrics associated with BNPL are growing rapidly. In fact, in Q1 of this fiscal, the gross merchandise value (GMV) was much more than what we clocked as GMV for BNPL in all of last year. Whether it be number of transactions, average ticket size (grown to ₹ 3,200) or the number of repeat users — all of them are growing,” she added.

Under-served segment

Mobikwik is one of the leading players of BNPL with an approved user base of 23 million.

“Our near term aspiration is to first take the number of our active BNPL users to the same level as credit card in force of the largest credit card issuer in the country,” Taku added.

Increased smartphone penetration, cheapest data plans and a boom in online shopping has propelled the demand for pay later products in the country. Given the under-penetration of financial markets, digital financial service providers see ample scope for growth in the country.

Well-differentiated offerings

Meanwhile, Mobikwik is looking to tap the IPO market at a time when several other digital businesses, including its competitor Paytm, are looking to come out with their own public offerings this quarter (Oct–Dec 2021).

Asked if she felt this crowding of internet businesses at the IPO market could affect Mobikwik’s prospects, she replied in the negative.

Also see: Mobikwik gets SEBI’s nod to float IPO

“There are several digital and tech companies coming to market. It is a good thing for India for the scale of GDP that it has. So far, there have been only three to four tech IPOs. India is going to have a booming high-growth internet economy for the next decade. We at Mobikwik are well positioned to ride on trend. Our business model is well-differentiated when compared to others. Hopefully, investors will understand this,” Taku said.

“Two pillars of our growth are consumer payments and BNPL. This is a unique and differentiated value proposition that we are going out with,” she said.

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Ezetap partners with Axis Bank to bring ‘My Vyappar’ for retail segment, BFSI News, ET BFSI

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Ezetap, a digital payments leader, has joined hands with Axis Bank, who has been at the forefront of driving innovation in retail acquiring, to introduce the latest offering My Vyappar to retail businesses in India. Through My Vyappar, Axis Bank will introduce a host of services enabling effective digital payments management for the merchants across the country. As part of the partnership, over 50,000 smart POS devices have already been deployed with My Vyappar across 1600+ cities.

The medium and small-sized retailers of the country have been at a financial disadvantage to compete against the large businesses. The pandemic worsened the situation further as the sales plummeted and customers shifted to digital mode of transactions owing to the fear of contracting the virus. There was a significant movement from cash to digital payments with an increasing number of Indian businesses accelerating their digital transformation journey. While India surpassed the world with an astonishing 25 billion real-time online transactions in 2020, the relatively smaller merchants didn’t have the bandwidth or budget to pivot as quickly as large businesses.

Through My Vyappar, Axis Bank brings in a wide array of attributes curated specifically for the retail segment in India. My Vyappar offers a full suite of Buy Now Pay Later (BNPL) options that can boost revenue. EMI facilities would be available for ticket sizes as small as even INR 3000. The app also aims at motivating the merchants to increase the use of digital payments, by incentivizing them with exciting rewards, upon achieving bank goals. My Vyappar app provides businesses with a single view of all credit transactions that can be accessed anytime anywhere. This would help merchants to go paperless and access their digital records even at home.

My Vyappar also provides the much-needed multilingual capability by adding Hindi as an additional language to help retailers understand digital payments better and speed up their tech adoption. To ensure seamless user-experience for merchants, My Vyappar app offers a simplified interface, similar to existing mobile platforms. To make retailers more agile and flexible with digital payments, the app ensures complete handholding in the form of in-app training. It also establishes a direct channel through which banks can communicate directly with merchants and offer personalized plans including loan options and reward schemes.

Speaking about the role of My Vyappar in improving digital payment adoption, Byas Nambisan, Chief Executive Officer, Ezetap, said, “We, at Ezetap, took a deep look at the pain-points of the merchants using digital payments and were determined to solve the challenges that still limit the business benefits of adopting the digital route. Through My Vyappar app, we aim to solve these issues while providing the merchants with effective ways to expand their businesses. With all its features including in-built training and support functions, we are confident that the app will provide the much-needed efficiency in managing and tracking digital payments. This also serves as a testament to our commitment to provide innovative solutions to simplify digital payments for banks as well as businesses.”

Commenting on the association, Sanjeev Moghe, EVP & Head – Cards & Payments, Axis Bank, said, “We have been continuously working on partnership led models & digital solutions to expand our offerings to the merchant community. In this endeavour, we are delighted to join hands with Ezetap to bring My Vyappar app for our retail merchant customers. The app would empower our customers to be more flexible and agile with digital payments thereby aiding their business growth. While adoption of digital payments has improved in the country in recent times, there has been much scope for improvement and simplification. My Vyappar app addresses all these gaps and will prove to be highly beneficial not only for the merchants, but also for us in improving our communication and engagement with our customers from the merchant community.”

Currently, Ezetap hosts about 3 lakh merchants on their platform. The company expects this base to grow by about 70 percent over the course of the year with My Vyappar being a critical element to aid that growth.

At Ezetap, veterans from payments, hardware, cloud, and SaaS industries have joined hands for the sole purpose of ushering in a new era of a frictionless digital payment ecosystem in India. Ezetap has deployed over 3,00,000 smart service points on its platform with customers ranging from brick-and-mortar retailers, e-commerce players, leading enterprises, and financial inclusion organizations. Ezetap processes over US$5 billion annually and has been ranked thrice in-a-row by CNBC in their Global Top 50 Disruptor List. Having raised $51 million in funding, investors include Social Capital, the Silicon Valley firm led by former Facebook executive Chamath Palihapitiya, Helion Advisors, American Express, Li Ka-Shing’s Horizons Ventures, JS Capital (Jonathan Soros), and Prime Venture Partners.

Axis Bank is the third largest private sector bank in India. Axis Bank offers the entire spectrum of services to customer segments covering Large and Mid-Corporates, SME, Agriculture and Retail Businesses. With its 4,600 domestic branches (including extension counters) and 11,061 ATMs across the country as on 30th June 2021, the network of Axis Bank spreads across 2,628 centers, enabling the Bank to reach out to a large cross-section of customers with an array of products and services. The Axis Group includes Axis Mutual Fund, Axis Securities Ltd., Axis Finance, Axis Trustee, Axis Capital, A.TReDS Ltd., Freecharge and Axis Bank Foundation.

This story is provided by NewsVoir. will not be responsible in any way for the content of this article. (ANI/NewsVoir)



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Banks step up credit card sales, offers in festive season as BNPL threatens, BFSI News, ET BFSI

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With the Covid pandemic weakening and consumer confidence rising, banks are betting on credit card spends this festive season. Lenders have launched a slew of new credit cards and offers to solidify their positions and grab a bigger share of the market.

The credit card push comes at a time when buy now-pay later (BNPL) products have become popular with consumers. BNPL essentially offers around 15 days of interest-free funds to small borrowers and are seen as competitors of credit cards.

SBI offering

Banks step up credit card sales, offers in festive season as BNPL threatens

SBI Card is luring consumers with 10% cashback up to Rs 10,000 across mobiles, consumer durables, laptops, kitchen appliances, home décor & furnishing, and fashion & lifestyle purchases, done at leading domestic e-commerce shopping sites. The offerings are not restricted to just one or two e-commerce portals

However, the offer will not be applicable on online spending in some categories such as insurance, travel, wallet, jewellery, education, healthcare, and utility merchants.

HDFC Bank

Banks step up credit card sales, offers in festive season as BNPL threatens

HDFC Bank and digital payments firm Paytm will launch a range of credit cards powered by Visa this month. The partnership aims to provide one of the widest range of offerings across customer segments, with special focus on millennials, business owners and merchants. Under the partnership announced in August, the two will build comprehensive solutions across payments gateway, point of sale machines, and credit products.

The cards announced today will be customised to meet the distinct needs of retail customers, from new-to-credit users to affluent users and offer rewards and cashback for users. The new cards offering will also facilitate small business owners.

Federal Bank cards

Banks step up credit card sales, offers in festive season as BNPL threatens

Kochi-based private lender Federal Bank entered the credit card business in September in association with card network Visa. The bank has partnered with National Payments Corp of India to launch ‘Federal Bank RuPay Signet Contactless Credit Card,’ according to a press release.

The card’s annual percentage rate starts from 5.88% per annum. Cardholders will gain access to a wide range of offers and deals across categories including travel, food, among others, the bank said. The card is currently being offered to existing customers of Federal Bank.

According to the Reserve Bank of India (RBI), the total number of credit cards stood at 63.4 million at the end of July.



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Mastercard rolls out buy now, pay later program, BFSI News, ET BFSI

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Mastercard Inc unveiled on Tuesday a buy now, pay later (BNPL) program that will allow consumers to pay for online and in-store purchases through equal and interest-free installments.

The Mastercard Installments program will be available in markets across the United States, the United Kingdom and Australia, the company said.

The company also said it will work on the BNPL program with banks and fintech firms, including Barclays Plc’s U.S. unit, Fifth Third Bancorp, Marqeta Inc, and SoFi Technologies Inc, in the United States, and Qantas Loyalty and Latitude in Australia.

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ZestMoney raises USD 50 mn funding from Zip Co, BFSI News, ET BFSI

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ZestMoney, which offers Buy Now Pay Later (BNPL) platform, on Wednesday said it has raised USD 50 million (about Rs 369 crore) from global BNPL provider Zip Co Ltd. This is part of a larger series C fundraise that will see participation from existing investors, a statement said.

Zip will acquire a minority shareholding in the company and a board seat as part of the investment, it added.

ZestMoney plans to deploy the funds to expand the product suite, deepen the transaction network, strengthen its balance sheet capacity and launch new business lines in insurance and savings, the statement said.

The company has raised USD 120 million till date from investors including Ribbit, Goldman Sachs, Quona Capital and Xiaomi.

Zip – which was founded in Australia in 2013 – has a presence in 12 markets across five continents, serving more than 7.3 million customers and over 51,000 merchants.

Founded by Lizzie Chapman, Priya Sharma and Ashish Anantharaman in 2015, ZestMoney allows customers to pay for products over time. Increasing smartphone penetration, cheapest data plans in the world and boom in online shopping has propelled the demand for BNPL offerings in the country.

ZestMoney offers the entire spectrum of BNPL offering from 30 days to 24 months and ticket sizes ranging from Rs 50 to Rs 5 lakh. The digital omnichannel BNPL player allows customers to transact at over 10,000 online sites and 75,000 physical stores across the country. It has 11 million registered users.

Smartphones, large appliances, fashion, travel, home decor, ed-tech are the largest categories on the platform. Electric bikes, ayurveda products, and personal care are popular among customers using the pay later option.

ZestMoney partners with 25 banks and NBFCs to power BNPL transactions for consumers across the country.

“We are thrilled to have Zip come onboard for the next phase in our journey of powering affordability in the lives of Indian consumers. This is a deep validation of our position as market leader in the Buy Now Pay Later category in India,” ZestMoney CEO and co-founder Lizzie Chapman said.

The shift towards pay later solutions is a global phenomenon and represents young digital consumers looking for transparency, honesty and no hidden charges in financial products, Chapman added.

“We believe India will leapfrog traditional products like credit cards, along with many other emerging markets, going straight to digital payment solutions. Over the last year we have seen applications for BNPL go up by 5X on our platform. We continue to invest in deepening partnerships with our merchant network and hiring the best talent,” she said.

ZestMoney strongly believes that India will emerge as the largest BNPL market in the world over the next five years, she added.

Larry Diamond, CEO of Zip Co, said while BNPL is emerging as a preferred mode of payment globally, in India it also plays a crucial role in driving access to credit.

“With deep partnerships with online and offline merchants and lending partners, Zest Money is poised to accelerate growth as the market develops. We have been incredibly impressed with the founders and leadership team and look forward to the next stage of the ZestMoney journey,” he added.

ZestMoney recently secured the Corporate Agent licence from Insurance Regulatory and Development Authority of India (IRDAI) allowing it to offer and enable insurance products to users on its platform.



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Flipkart partners Davinta to offer credit facilities to MSMEs, kiranas, BFSI News, ET BFSI

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New Delhi, Sep 18 (PTI) Flipkart Wholesale, the digital B2B marketplace of Flipkart Group, on Saturday said it has partnered with SME lending platform Davinta to offer a ‘Buy Now Pay Later‘ (BNPL) credit facility to its retailers. Flipkart Wholesale Senior Vice-President and Head Adarsh Menon said access to affordable and transparent credit is one challenge the company aims to solve.

“Partnering with Davinta will give members on our platform access to credit with a single click. The experience for the retailers is seamless and completely digital and was only possible because both our organizations take a technology-first approach,” he said in a statement.

As this partnership is strengthened, this construct will allow more and more of Flipkart Wholesale’s Kirana and MSMEs members to enjoy the benefit of accessible and affordable credit in the pursuit of their growth on the platform, he added.

‘Buy Now Pay Later’ or BNPL has emerged as a credit innovation from new-age fintechs, who are offering this as an alternative to customers who struggle to be eligible for traditional credit constructs such as credit cards.

With more than 6 crore small businesses in India, a majority of whom struggle to get access to traditional credit, BNPL offers a massive opportunity to drive financial inclusion and provide the much needed affordable credit access to these small business owners.

“We are very excited with the opportunity to partner with Flipkart Wholesale and offer our BNPL product to the over 1.5 million members of Flipkart Wholesale,” Davinta CEO Ravi Garikipati said.

He added that with BNPL, the company is now allowing retailers across the country to unlock themselves from cash constraints while purchasing supplies and enjoy simple one-click credit access.

Bengaluru-based Davinta was founded by ex-Flipkart CTO Ravi Garikipati and US-based entrepreneur Raj Vattikuti. The two-year-old firm focuses on micro-enterprises and its flagship product Vyaapaar Shakti is a BNPL credit facility designed for small retailers. PTI SR MR MR



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