Flipkart, Davinta tie up to offer credit facilities to small biz, kiranas

'Partnering with Davinta will give members on our platform access to credit with a single click,' says Adarsh Menon, senior vice president and head - Flipkart Wholesale

Flipkart Wholesale, the digital B2B marketplace of the e-commerce firm, has formed a partnership with SME lending platform Davinta offering a ‘Buy Now Pay Later’ credit facility to all its retailers.

‘Buy Now Pay Later’ or BNPL as it is more popularly known has emerged as a credit innovation from new-age fintechs. They are offering this as an alternative to customers who struggle to be eligible for traditional credit constructs such as credit cards.

"We are very excited with the opportunity to partner with Flipkart Wholesale and offer our BNPL product to the over 1.5 million members of  Flipkart Wholesale,” said Davinta CEO Ravi Garikipati. “With BNPL we are now allowing retailers across the country to unlock themselves from cash constraints while purchasing supplies.

With more than 60 million small businesses in India, a majority of whom struggle to get access to traditional credit, BNPL offers a massive opportunity to drive financial inclusion. It provides much needed affordable credit access to these small business owners. As the economy slowly limps back to normal and the festive season coming up, consumer demand is increasing and so is the demand for credit among retailers. With BNPL-like credit innovations, many small retailers are finally getting the kind of easy credit they need to restart their businesses and fintech’s like Davinta are rapidly tapping into this massive market.

“Partnering with Davinta will give members on our platform access to credit with a single click,” said Adarsh Menon, senior vice president and head - Flipkart Wholesale. “We are confident that this construct will allow more and more of our Kirana and MSMEs members to enjoy the benefit of accessible and affordable credit in the pursuit of their growth on our platform.”

Bengaluru-based Davinta, was started by ex-Flipkart chief technology officer Ravi Garikipati and US-based entrepreneur Raj Vattikuti. The two-year-old firm focuses on micro-enterprises and its flagship product Vyaapaar Shakti is a BNPL credit facility. It is designed for small retailers to be utilized as an instant credit facility while purchasing supplies from offline wholesalers or on digital marketplaces.

Flipkart Wholesale has also seen a surge in suppliers that have come onboard the digital B2B marketplace. The supplier base is expected to grow 58 per cent in 2021, which will further boost the local business ecosystem as well as livelihoods. The company recently rebranded its Best Price cash-and-carry business which it acquired from Walmart India in 2020. The firm said it is staying committed to the growth and prosperity of kiranas in India through an omnichannel business model.

Flipkart Wholesale witnessed 17 per cent growth in its kirana customer base in January-June 2021 compared to the same period last year. The kirana customer base is projected to further grow by 33 per cent in July-December 2021, compared to the same period last year.