E-commerce groups Amazon and Flipkart are stepping up their move into Indian financial services with new lending plans aimed at consumers and small businesses, sharpening competition with the country’s traditional banks. Their push comes as India’s consumer loan market has almost tripled in five years to around $212 billion, underscoring the rapid growth of digital credit in one of the world’s fastest-expanding major economies.
Both companies are drawing on large customer bases, popular payments apps and extensive data on shoppers and merchants to design tailored products. Their expansion shows how technology platforms are pushing deeper into financial services, backed by recent changes from the Reserve Bank of India (RBI) that allow tech-owned non-bank lenders to operate more directly in the credit market.
Tech Giants Deepen Their Financial Services Push
Earlier this year, Amazon acquired Axio, a Bengaluru-based non-bank lender focused on buy-now-pay-later (BNPL) and personal loans. Under Amazon’s ownership, Axio plans to restart lending to small businesses and add cash management tools to help merchants manage working capital. Mahendra Nerurkar, Amazon’s vice president for payments in emerging markets, said the company sees “tremendous headroom” to extend credit to digitally active customers and smaller firms outside India’s biggest cities.
Amazon already runs Amazon Pay, a major wallet for transactions over the Unified Payments Interface (UPI), and has partnered with local lenders to offer fixed deposits inside its app. Combined with Axio’s lending capabilities, these services position Amazon as a broader financial platform rather than a pure e-commerce marketplace.
Flipkart, about 80% owned by Walmart, is taking a similar route. The company set up a non-bank lender, Flipkart Finance, in March and is awaiting final approval from the RBI for its business plans. Once cleared, Flipkart will be able to lend directly to shoppers instead of relying solely on partner banks and finance companies.
New Loan Products Target Online Shoppers
Regulatory filings show that Flipkart Finance intends to launch two main types of pay-later products. One will offer no-cost installment loans for purchases on Flipkart’s platform, with repayment periods of 3 to 24 months for customers wanting to spread payments on big-ticket items without interest. The other will provide loans for consumer durables at annual interest rates between 18% and 26%, above the roughly 12% to 22% typically charged by many traditional lenders. Flipkart expects to introduce the products next year, according to a source with direct knowledge of the plans.
For Amazon, Axio’s renewed small-business lending is expected to complement tools already offered through its marketplace and payments operations. Credit lines structured around sales data and cash-flow patterns could help smaller sellers fund inventory and promotions while giving Amazon a clearer view of their financial health.
Banks Confront Rising Competition In Consumer Credit
India’s unsecured retail borrowing segment has been one of the fastest-growing parts of the financial system. Data from credit bureau CRIF High Mark show that the consumer loan market expanded from roughly $80 billion in March 2020 to about $212 billion by March 2025. Regulators have already warned lenders about rapid growth in personal loans and credit card debt, prompting some banks to tighten underwriting standards.
Banks have long dominated this business, but they now face mounting competition from fintechs and large digital platforms. Both Amazon Pay and Flipkart’s shopping app rank among the most-used UPI payment applications, giving them direct access to millions of users’ transaction histories. Analysts say that, combined with the RBI’s decision to let wholly owned non-bank units of tech firms lend directly, this data could give the platforms an advantage in underwriting and cross-selling.
“There is immense potential for them to make a dent because they own both the supply-side and demand-side customer data,” said Rohan Lakhiyar, a partner at consultancy Grant Thornton Bharat who focuses on financial services risk. At the same time, he cautioned that execution risk is high as the companies move beyond core retail and into more heavily regulated activities.
Regulatory Scrutiny And Market Outlook
The RBI has signalled that it wants to encourage innovation in digital finance while keeping close watch on risks. In recent years the central bank has issued detailed rules on data sharing, outsourcing and customer protection for digital lenders, and has warned banks against excessive growth in unsecured loans. Market observers expect regulators to track how tech-owned lenders such as Axio and Flipkart Finance manage borrowers, price risk and collect repayments as their portfolios grow.
At the same time, the scale of India’s credit gap leaves room for multiple players. Millions of consumers and small enterprises remain underserved by formal finance, particularly outside major cities. By combining shopping, payments and credit within a single interface, Amazon and Flipkart are betting they can capture a greater share of that demand and secure a larger role in India’s evolving lending market.
