SMBs can acquire loans between 500k and 5 million Indian rupees ($6725 to $67250) without collateral.
Facebook’s “Small Business Loans Initiative” aims at making it easy for small and medium businesses (SMBs) to apply for and acquire loans online without a processing fee. The program will be available for businesses registered across 200 cities and towns across India.
The launch is in response to a 2020 survey where a third of operational SMBs on Facebook said they expected cash flow and timeless credit to be possible challenges in the future. The company has tied up with Indifi to lend loans at a predefined interest rate of 17%-20% per annum.
The social media giant will offer a 0.2% reduction per annum on the interest rate for businesses wholly or partly owned by women. Additionally, SMBs are not obligated to spend the loan amount on Facebook advertising.
[2 minute read]