India’s largest e-commerce firm Flipkart is working on to develop a video-based Know Your Customer (KYC) system to offer instant credit to users for purchasing on its platform. Earlier last year, Flipkart disclosed its plans to enter the lending segment. However, the company did not disclose many details like eligibility, the amount offered etc.
This technology can help Flipkart speed up its credit approval process especially after the Honourable Supreme Court banned the Aadaar Authentication system. With the help of the automated process, Flipkart wants to tap into the ever-growing Indian fintech market. The e-commerce giant is working with smaller fintech firms to offer ‘cardless credit’ services to its customers.
Flipkart is testing the video-based KYC system with around 10,000 customers. RBI has not yet approved the finance business of the company. However, Flipkart expects to obtain an RBI license soon and then it will extend the service to more customers.
The Walmart-owned and backed firm has already provided loans to more than 12,00,000 customers through various partners. It is now looking forward to developing its proprietary credit underwriting model using its own customer data. In July 2018, Flipkart announced its entry into the fintech space and its plans to offer microlending and micro-insurance as well as long term plans to introduce products like general and life insurance.
Flipkart’s rival Amazon launched its Seller Lending Network back in June 2018 which offer its registered sellers credit from multiple third-party lenders. Amazon’s Seller Lending Network help its sellers choose from loan offers tailor to their business needs. It provides various financial products like term loans as well as overdrafts.
Indian digital lending market has the possibility to touch $1 trillion in the next five years, a report by BCG predicts. This huge opportunity in the finance sector has led to the emergence of multiple startups in the field. Some of the notable names in the online credit space in India are ZestMoney, Lendingkart, KredX, KreditBee, MoneyTap, Indiabulls Dhani, Capital Float and Flexi Loans.
Moreover, the P2P lending sector in the country is also booming. There are several startups that are utilizing the potential in this space. Some of them are i2ifunding, Faircent, Finzy and LendenClub. There are some more. You can read this list of 14 P2P Lending startups in India to know about them all.