Capital Float to offer no-cost EMIs

By: | Updated: June 22, 2018 1:33 AM

The company says merchants have seen sales rise by up to 40% as a result of the EMI option.

Capital Float to offer no-cost EMIs

Digital lender Capital Float has forayed into consumer lending with a no-cost EMI option that consumers can access through its merchant partners. The interest cost for such consumer loans will be borne through an arrangement between the merchants and Capital Float, Sashank Rishyasringa, co-founder at the company, told FE on Wednesday, while refusing to share details on the interest rates being charged.

Since inception, the lending start-up has been engaged largely in lending to medium, small and micro enterprises (MSMEs). It began running a pilot for the EMI product with consumer-facing businesses a year ago and is now offering the service at 1,300 points of sale at present. It is adding about 15,000 customers a month, Rishyasringa said.

“We realised, while working with a large range of B2C businesses like small hospitals, schools, vocational training institutes, small shops selling electronics and merchants, that while all these types of businesses need funding for their own operations, there was also a clear opportunity to enable them to offer their end customers an EMI option, particularly on larger-ticket purchases,” he said.

The company expects to be able to continue with the arrangement with its merchant partners as it says merchants have seen sales rise by up to 40% as a result of the EMI option. “We believe this should be sustainable,” Rishyasringa said. “It increases conversion and also increases the average ticket size of the sale because merchants are able to up-sell the customer a higher quality product, given the affordability option being offered to the consumer.”

Capital Float is aiming for a customer base of over two lakh by the end of this year through the consumer financing solution. It has so far acquired partners in over 250 companies across verticals.

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