E-commerce majors like Flipkart and Amazon have launched cardless credit schemes for credit-worthy yet underserved customers.
Flipkart’s Big Billion Days and Amazon’s Great Indian Festival sales have finally kicked off. And with a big bang. After all, the festive season has started, and everyone seems to be in a mood to eat, shop and make merry. So, what if you don’t have a credit card or enough money to splurge? The e-commerce giants are here to help you.
In fact, to help such customers, some retail majors have come out with some innovative schemes and payment options whereby you can get an instant credit line of up to Rs 60,000 to make your shopping experience memorable. All you need to do is to provide your PAN card and Aadhaar details to the concerned retailer.
For instance, in a bid to give their customers a convenient and worry-free shopping experience, Flipkart has introduced ‘Cardless Credit’, which enables a customer to get an instant credit line of up to Rs 60,000 to make purchases on Flipkart. According to the company, the move is aimed at millions of credit worthy yet underserved customers who the traditional banks are not able to serve / underwrite credit for.
Flipkart says the current process of getting access to a credit card takes more than 10 days and the high cost of getting credit makes small ticket-size loans cumbersome and unviable. Also, most of the customers do not get credit due to inability of the Indian banking industry to underwrite new-to-credit customers due to lack of data and insights. However, cardless credit has not only simplified access to credit in real time, but has also simplified credit assessment and application process.
Similarly, Amazon Pay has also launched card-less EMIs for select Amazon customers. Amazon Pay EMI provides instant financing options to customers up to Rs 60,000 by splitting their purchases into instalments at low-interest rates. The company said in a recent press release that currently, this is an invite only program and selected customers will have to complete a simple two-step registration process to get an assigned credit limit which they can use to make high-value purchases on Amazon marketplace.
How Flipkart’s Cardless Credit works
# You need to sign up for the credit line on Flipkart
# The application process will take 60 seconds
# Instant access to credit line (up to Rs 60,000) is given based on scores derived from customer behavior on Flipkart
# You will have to provide your PAN card, Aadhaar details
# During checkout, you will get access to Two propositions: Pay Later next month and EMIs of 3-12 months (No Cost EMI available)
# OTP less checkout for value < Rs 2000
# At the end of the month, you can pay your dues
# Payback on the Flipkart app using Debit card or Netbanking
# This credit line can be used to purchase any product on Flipkart using EMIs or Pay Later (payback by 15th of next month).
How Amazon Pay EMI works
# With Amazon Pay EMI, invited customers will see an option to register for the credit facility on the Amazon Pay homepage.
# Upon providing your PAN and KYC details (no document uploads required), you will be instantly provided credit limit up to Rs 60,000.
# Interest will be charged only when you make a purchase using this assigned credit limit
# There are no processing fees or hidden charges.
# You will have an option to set up auto repayments (standing instructions) for hassle-free repayment of your monthly installments.
# You can track your EMI order history, repayment history and pending dues through Amazon Pay homepage.
View of Legal Experts
Giving their opinion on these schemes, some legal experts, however, said that while these schemes look good, asking for KYC details like Aadhaar number for giving cardless credit may be in violation of the recent Supreme Court order which bars the use of Aadhaar database by private companies.