Credit and Finance for MSMEs: The collateral-free loans will be in the range of Rs 5 lakh and Rs 50 lakh; charged at a pre-defined interest rate of 17%-20% per annum.
Credit and Finance for MSMEs: Social media platform Facebook India today announced the launch of collateral-free loans for small and medium businesses (SMBs) to enable easy access to credit.
The loans will be processed and disbursed through Facebook’s programme partner Gurugram-based lending firm Indifi Technologies.
Indifi is the first lending partner and more such partnerships are on the cards, said Ajit Mohan, VP and MD Facebook India during the press conference.
On the launch, Mohan added, “We want to leverage the fact that Facebook for most of these businesses is a window to the world, they invariably have a Facebook presence and are advertising on Facebook…..there’s an opportunity for us to leverage that knowledge, and our connect with small businesses can help them get access to credit from lenders who are partners of ours and are willing to lean in.”
The loans will be in the range of Rs 5 lakh and Rs 50 lakh; charged at a pre-defined interest rate of 17%-20% per annum. Women entrepreneurs will be charged 0.2% less interest. This facility is currently available for businesses across 200 Indian cities and the plan is to increase the reach as more partners onboard the programme.
Facebook doesn’t have any monetary benefit from these partnerships and
small businesses are not obligated to spend their loan amount on Facebook advertising.
In addition, it is also not important for the small businesses to be an advertiser on the Facebook apps: Whatsapp, Facebook and Instagram, said Mohan. The rationale, he said, is “we see that as these businesses will grow and have enough revenue they will probably use our solutions that may benefit us in the long term and we’re totally fine with it.” According to the company, out of the total 200 million business users on Facebook apps, 10 million are advertisers.
Last year during the pandemic, Facebook had announced a $100 million global grant out of which more than $4 million was deployed in India for 3000 small businesses.