Paytm Joins Forces With ICICI Bank To Provide Digital Loan Upto Rs 20,000!
Customers who are common to both Paytm and ICICI Bank can now avail instant digital loan starting from ? 3,000/- upto ? 20,000/-
In a unique amalgamation of financial services, India’s largest mobile wallet: Paytm, has joined forces with India’s largest private bank: ICICI Bank, to provide small digital credit to some selected users.
In a one of its kind initiative, Big Data would be used to determine the credit limit of users, and mobile wallet would be used to disperse instant digital credit.
We are terming this unique amalgamation, because while Paytm has also launched their Payments Bank, they are willing to partner with another bank; and while ICICI Bank has their own wallet called Pocket, they are willing to partner with another mobile wallet company.
Maybe digital is the great equalizer; and ICICI-Paytm Postpaid is the perfect example.
Get Short Term Digital Loan Upto Rs 20,000!
Under this arrangement, customers who are common to both Paytm and ICICI Bank can now avail instant digital loan starting from ? 3,000/- and extendible upto ? 20,000/-.
What Paytm and ICICI Bank is doing here, comes under the niche of micro-loans, or also called pay-day loans in the USA. Some startups like Kisst, happyloans, Krazybee and Smartcoin etc are already active in this regard, but this is for the first time that a major bank has collaborated with a mobile wallet to make it happen.
The credit limit of the customer will be determined by Big Data, as that person’s previous expenses, habit of making payments etc would be evaluated to determine how much digital loan can be availed.
Anup Bagchi, Executive Director, ICICI Bank said,
“We have leveraged upon Big Data to develop a new algorithm that instantly assesses the creditworthiness of customers using a combination of financial and digital parameters to sanction the credit line instantly,”
As per Paytm founder and CEO Vijay Shekhar Sharma, such short loans availed instantly will help consumers to manage their daily expenses, and will help them to plan their monthly budget in an efficient manner.
“Paytm Postpaid will play a major role in helping them pay for their daily expenses on time. This will democratise access to credit including those with less disposable income,”
No Registration, No Joining Fees – Get Instant Loan!
One of the unique features of this micro-loan feature is that, there is no physical documents required to start using it, there is no registration, and no joining fees.
Customers who are eligible for this, will see ‘Pay Later’ option on their Paytm app, and once chosen, they will be automatically enrolled into the micro-loan cycle.
The re-payment will have 45 day-grace period, and a bill would be generated on the 1st of next month, which needs to be paid within 15 days. Paytm wallet, net banking or debit card can be used to make this payment.
As of now, there are no details available as to how much interest would be charged beyond that period.
To start with, this service would be rolled out to those users who have accounts with ICICI Bank, and Paytm both. Gradually, other bank’s customers would be enrolled into it.
And ultimately, this feature would be for those who don’t have any credit history and/or don’t have any bank account in the first place!
Hence, we can say this is a unique approach to expand banking net, and open up banking sector to more and more people.
Do you think that such instant ‘digital credit’ scheme will work in India? Do share your opinions by commenting right here!