Amazon, Flipkart will offer loans to Indian consumers, small businesses
What's the story
Amazon and Flipkart are taking on traditional banks in India by launching new lending products for small businesses and consumers. The move comes as part of their expansion into financial services. Amazon, which recently acquired non-bank lender Axio, is planning to relaunch small-business loans and cash-management tools. The company has seen high demand from digitally active merchants in tier-2 and tier-3 cities.
Strategic approach
Amazon's tailored lending propositions for small businesses
Mahendra Nerurkar, VP for payments in emerging markets at Amazon, told Reuters that there's a huge potential for credit growth in India. He said this especially applies to digitally engaged customers and small businesses in non-metro cities. Nerurkar also revealed that the company will be "designing tailored lending propositions" to help these merchants manage cash flow efficiently and unlock capital.
Financial expansion
Flipkart's foray into buy-now, pay-later products
Walmart-owned Flipkart is also looking to expand its financial services. The company has registered its non-bank lending arm, Flipkart Finance, and is waiting for the Reserve Bank of India (RBI)'s approval. Flipkart plans to offer two types of pay-later products: no-cost monthly installment loans for online shoppers and loans for consumer durables at an interest rate of 18%-26% per annum.
Market growth
India's consumer loan market and tech firms' entry
India's consumer loan market has grown from nearly $80 billion in March 2020 to around $212 billion as of March 2025, according to credit bureau CRIF High Mark. This includes unsecured personal loans, credit cards, and loans for consumer durables. Both Amazon and Flipkart have apps that are among the top 10 most used platforms for payments via India's Unified Payments Interface (UPI).
Regulatory impact
RBI's approval boosts financial ambitions of Amazon and Flipkart
The RBI's recent decision to allow tech firms to lend directly to customers through wholly owned units has given a major boost to the financial ambitions of Amazon and Flipkart. This move has opened India's financial services market for foreign-backed tech firms. Rohan Lakhiyar from Grant Thornton Bharat's financial services risk division said these companies have immense potential due to their access to both supply-side and demand-side customer data.