Decoding Vijay Shekhar Sharma’s latest tweet on – 2020 being the ‘year of lending’

• Paytm founder Vijay Shekhar Sharma has said 2020 will be the year of lending.
• Interestingly, Paytm Business Loan was launched in January.
• In December 2019, players like Xiaomi and Realme too had entered the credit business in India.

Vijay Shekhar Sharma is going big on lending and he himself let it out on Twitter. Sharma, who founded One97 Communications which runs Paytm declared 2020 as the year of lending.


There is a reason behind Sharma’s prophecy. In January, Paytm launched its lending feature for business loans. Paytm Business Loan disperses loans from a minimum of ₹10,000 to ₹2 lakh for a tenure of 180 days. Through the same, users will be eligible for a higher loan limit once the current period exhausts. But, only if there are no defaults.

In January, Paytm also launched an all-in-one QR code for merchants. Through this feature, merchants will be able to accept unlimited payments from Paytm Wallet, Rupay Cards and all UPI-based payment apps directly into their bank account without having to pay a processing fee.

Paytm’s Senior Vice President Saurabh Sharma too told ET that the company is gunning for an NBFC (Non-banking Financial Company) licence. In July 2019, Paytm also partnered with the NBFC Clix Finance to offer instant digital loans.

The power of lending

Digital lending has the potential to gather space especially as credit availability from traditional sources has slowed down. According to the Economic Survey released before the Union Budget, credit growth slowed down to 7.1% in December last year. A year before, it was over 12% - squeezing industry in times of growth slowdown.

The digital lending space is also crowding with new and unlikely players like smartphone makers Xiaomi, Realme entering the space. Xiaomi launched Mi Credit in December 2019, and that was soon followed by the launch of Realme Paysa.

Xiaomi MD and CEO Manu Kumar Jain had said that he sees a potential in the 1.9 crore personal loan consumers in the country. According to a BCG report, India’s online credit lending industry will be worth $1 trillion by 2023.

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Smartphone makers Realme and Xiaomi will compete in the financial services market too