Home / Tech News / Alibaba’s Lazada begins to offer financing for online retailers in Southeast Asia

Alibaba’s Lazada begins to offer financing for online retailers in Southeast Asia


Alibaba’s Lazada is introducing new credit options for SMEs as it aims to boost the number of retailers in Southeast Asia, the region with 650 million consumers.

The firm announced a partnership with Finaxar that will see the fintech offers its services to Lazada sellers in Singapore. There are plans to expand the arrangement to cover other parts of Southeast Asia in the future.

Two-year-old Finaxar offers a range of financial products in Southeast Asia but now it has teamed up with the e-commerce company to provide a credit line option for Lazada sellers, as opposed to more structured financing such as loans. The credit line can last for up to six months, with up to SG$5,000-SG$1 million ($3,650-$730,000) on offer, the companies said.

The service is priced at 0.7-1.5 percent every 30 days and at a rate that is pro-rated. Finaxar said all fees are shown transparently in the service to avoid the unwanted surprise of hidden add-ons.

Finaxar founders Vihang Patel and Sian Tan told TechCrunch that a credit line gives companies the flexibility to dip into additional cash when needed, for example during peak season to buy more product, and also pay parts back when significant payment volumes come in, without the commitment of more formalized lending.

The financial assessment, they explained, comes via a one-click integration with Lazada seller dashboard. When clicked, that sends the merchant to the Finaxar where they are asked to provide information; a credit assessment is delivered in under five minutes.

Patel said Finaxar is currently assessing expansion to two undisclosed markets, which he said would include launches in collaboration with Lazada and potentially as soon as before the end of this year. That’s pretty crucial for the partnership to make an impact for Lazada, since most of its 300,000 retailers are located outside of Singapore.

Alibaba has pumped billions into Lazada since it took a majority investment in 2016. Most recently it injected $2 billion in March in a move which also saw Alibaba install Lucy Peng, one of its original 12 founders and the former Chairwoman of Lazada and ex-executive chairman of Ant Financial, as Lazada CEO.

Lazada is in a dogfight with Shopee, the e-commerce firm of U.S.-listed Sea, to become the dominant e-commerce platform in Southeast Asia. Sea recently pumped $500 million of newly-raised capital into Shopee, while this week its latest earnings revealed that the service’s quarterly revenue has grown to $58.8 million. Alibaba doesn’t reveal comparable figures for Lazada.

Lazada’s collaboration with Finaxar comes after Aspire Capital, an SME financing startup founded by an ex-Lazada executive, announced it had raised $9 million.



Source link

About admin

I'm a 50 year old PLC programmer from Burnley, UK. I severed my time as an electrician in the baking industry and soon got involved with the up and coming technology of PLC's. Initially this was all based in the Uk but as the years went by I have gradually worked my way around the globe. At first it was mainly Mitsubishi with a bit of Modicon thrown in but these days the industry leaders seem to be the Allen Bradley range of PLC and HMI’s.

Check Also

See you in Poland next week

I’m heading back to Europe to hang out in Wroclaw and Warsaw, Poland. Are you ...

Leave a Reply

Your email address will not be published. Required fields are marked *