Paytm offering up to Rs 5-Lakh collateral-free instant loans; Here’s how to apply

Paytm, India’s leading digital payments and financial services company, is offering collateral-free instant loans of up to Rs 5 lakh to small traders in conjunction with regular commercial banks and NBFCs. The loans are available at a low interest rate and come with a unique daily EMI option, Mint reported.

Merchants are eligible for loans through the Merchant Loan Program on the Paytm for Business app. Loans are disbursed after the app determines the merchant’s creditworthiness based on their daily transaction, using an algorithm.

As the process is fully digitized, no additional documents are required. The merchant can repay the loan through daily settlements with Paytm and no prepayment charge is levied.

To qualify for the collateral-free loan, small traders can follow these five simple steps:

  • The merchant should open the Paytm for Business app and click on the ‘business loan’ tab to check the available offer. Depending on the requirement, the trader can increase or decrease the loan amount.
  • By choosing the loan amount, other details such as amount to be disbursed, total amount to be paid, daily installments and term will appear.
  • The person receiving the loan must click on the checkbox to confirm the details and then click on the “begin” tab to continue. By giving consent to enter the KYC details of the CKYC, the merchant can benefit from minimal documentation and fast processing.
  • The app then asks the borrower to fill in the details of the PAN, date of birth and email address. It then verifies PAN, credit score and KYC details before sanctioning the loan.
  • Upon submitting the loan application, Paytm transfers the loan amount to the bank account.
  • Meanwhile, One97 Communications Limited, the parent company of the digital payment app, in a filing with the Bombay Stock Exchange (BSE), said it has seen accelerated growth in its lending business.

    In January 2022, the number of loans disbursed through the platform increased by 331% YoY to reach 1.9 million loans, while the value of loans disbursed increased by 334% YoY to reach Rs 921 crore .

    (Edited by : Shoma Bhattacharjee)

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