Country's largest lender State Bank of India will extend vehicle loans to driver-partners of Uber, the on-demand transport aggregation company. All these loans are collateral free and carry a very competitive interest rate and will get covered under the Pradhan Mantri Mudra Yojana.
"The on-demand transportation segment growth has created a whole new ecosystem enabling lakhs of Indians to earn livelihood by becoming micro-entrepreneurs on such platforms. In the process, it has also opened up a new world of opportunities for the banking industry, not just in the on-demand transportation loan space but also in other areas like payment wallet, consumer finance etc. It is now upon us to leverage these opportunities,” said SBI Chairman Arundhati Bhattacharya.
“Doing so requires us to think and go beyond the traditional banking products and delivery services," she added.
Under the new facility, drivers can apply for loans at the Uber Partner Centre and get loans sanctioned in one-day. SBI's digitally integrated backend system would eliminate the long processing time that other auto loan seekers are subject to.
"With this new facility, drivers can apply for loans at the Uber Partner Centre and get loans sanctioned in one-day. This is supported by our digitally integrated backend system, thereby eliminating the long processing time. The partnership with Uber will also help us simplify the documentation requirements thereby eliminating traditional financial statements like income tax returns. The product is also in line with our focus on building a risk mitigated portfolio, which is aimed at significantly improving the customer experience." said Rajnish Kumar, SBI MD, National Banking Group at the event.
"Access to quick and easy finance will provide necessary push to the growth of SME segment. The boom of on-demand transportation business will also provide impetus to the MSME sector. A vibrant MSME segment is very important to meet the macro-economic goals of the economy," he added.
Founded in 2009 in the US, Uber has operations in almost 400 cities in 68 countries across the world. Uber launched its India operations in September 2013, and is currently present across 27 cities in the country, more than any other country outside the US.
"India is a global market priority for us; the robust growth we've seen in India in just about two years is phenomenal. In such a short span of time, we've got over 250,000 driver partners on our platform who have become micro-entrepreneurs today" said Eric Alexander, President of Business, Asia Pacific at Uber.
He added that Uber expected to create 'tens of thousands' of micro entrepreneurs by enabling them to start their careers on the Uber platform, by owning their cars, through this programme with SBI.
BW Reporters
The author is Senior Correspondent with BW Businessworld
