Amazon launches pay later option in India

Amazon India has rebranded its cardless credit facility Amazon Pay EMI to Amazon Pay Later in India to offer a new credit service to its customers.

Customers can digitally sign up to avail this virtual line of credit that can be used to buy products as well as pay bills on the platform, Amazon said in a statement.

The service allows users to repay in the subsequent month at no additional fees or in EMIs up to 12 months at an interest cost attached (between 1.5% and 2% a month).

“Amazon Pay Later is a unique service that will help customers expand their access to credit and experience most convenient option of making payments. In current times Amazon Pay later empowers our customers to better manage their monthly spends,” Mahendra Nerurkar, CEO Amazon Pay India, said.

Amazon Pay has partnered with digital lender Capital Float to facilitate this service. Karur Vysya Bank (KVB) is a co-lending partner to Capital Float to scale up the service, the statement said.

After the completion of a one-time setup process, users can avail Amazon Pay Later payment option during checkout. It will also allow customers to track purchases, repayments, and limits history from a dashboard for this payment mode. 

The eligibility criteria include an Amazon.in account with a verified mobile number, a valid permanent account number (PAN) card, a bank account with one of the selected banks, and an officially valid document as address proof. The credit limit is decided by Capital Float based on the information available with Amazon and users’ credit bureau history.

Several fintech startups including LazyPay, the consumer lending platform of digital payment firm PayU India, Simpl, ePayLater and Zest Money allow users to access credit across offline merchants and ecommerce platforms.

The launch comes at a time when ecommerce businesses have taken a hit due to the restrictions on non-essential business operations due to the ongoing Covid-19 pandemic. 

According to a recent report by Cupertino headquartered online payments firm Wibmo, overall online purchases saw a dip of 16% after the country went into a 21-days nationwide lockdown. The decrease is majorly attributed to the unavailability of non-essential services. Meanwhile, e-commerce has gained much popularity during the lockdown as people continue to turn to online grocery stores for essentials. Consulting firm Capgemini predicts that a majority of Indian consumers may opt for online buying in nine months.

In a separate development, Seattle headquartered ecommerce firm Amazon announced last week that it is earmarking Rs 10 crore to onboard more local kirana stores on its platform. 

The programme, called Local Shops, has added over 5,000 local retailers and shopkeepers to the platform in the past six months. Through the programme, Amazon enables more footfall for shopkeepers as it combines the digital and physical aspects to expand their customer base, according to the company. Shopkeepers can receive additional income if their stores can be used as delivery and pickup points for Amazon’s operations.