Digital payments led to an increase in the BNPL model, enabling the growth of Kirana stores

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India’s informal BNPL model has seen an increase in refunds this Diwali season, with refunds 12% above average, and traders have seen 15% growth in business during the two-week holiday season. year.

The rise in digital payments has led to a growing trend for timely refunds by customers who primarily use the Buy It Now and Pay Later (BNPL) model of their local mom-and-pop stores. Up to 30 lakh clients paid their dues on time after Diwali.

India’s informal BNPL model has seen an increase in refunds this Diwali season, with refunds 12% above average, and traders have seen 15% growth in business during the two-week holiday season. year, according to a study by digital accounting application OkCredit.

Most of these stores usually struggle to collect their dues on time, however, this festive season has seen over 30 lakh customers show up to settle their credit. Merchants in restaurants, school supplies, travel, jewelry and Kirana stores saw the strongest customer growth, according to the study.

As the holiday season revived several sectors of the economy … it was encouraging to see the high credit recovery, ”said Gaurav Kunwar, Co-Founder and Product Manager, OkCredit.

SME growth

In addition, the increase in reimbursements and the growth of retail SMEs (small and medium-sized enterprises) also indicate a healthy recovery in the economy, especially Tier 2 and Tier 3 cities, as these cities make up a significant portion. of OkCredit’s Merchant Base, the study said.

There has been a 70% increase in the number of retail SMEs adopting a digital solution to manage their books, he said, adding that out of 35 states and union territories, 25 have seen growth. commercial compared to last year.

Others have remained more or less stagnant. Traders in states such as Kerala and Karnataka recorded an 8% growth in their activity. The northeastern states experienced the highest growth, dominated by Manipur where transactions per merchant rose 22%.

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