Microloans driving India’s festival shopping boom

Shoppers are taking loans for buying luxury items and even protein powders and hair dryers

- Sowmya Ramasubramanian [e-mail]

India’s festive season shopping spree this year is being driven not just by demand for luxury items like smartwatches and jewellery, but also by a surge in microloans powering purchases of less-expensive products such as protein powders and hair dryers.

Fintech startups such as Snapmint and Kiwi are seeing a rush of young shoppers avail low-interest consumer loans for their festive season purchases.

Snapmint, a Mumbai-based non-banking financial company, facilitates sales of multiple brands on its platform viainterest-free loans that can be repaid in equated monthly instalments (EMIs). In September, Snapmint saw its total volume of interest-free EMI transactions surge to more than ₹1 million from about 350,000 a year ago.

“The 20-30 age group represents nine out of every 10 of our customers for whom no-cost EMI has become the go-to finance option,” said co-founder Abhineet Sawa. Interest-free EMIs are the third-most popular payment method behind UPI and cash-on-delivery—a “striking surge we've never seen before”, he added.