Walmart-owned Flipkart secures NBFC licence from RBI

E-commerce giant Flipkart has been granted a Non-Banking Financial Company (NBFC) licence by the Reserve Bank of India (RBI), a spokesperson for the Walmart-owned company confirmed to Fortune India. Its entity, Flipkart Finance Private Limited, secured the RBI’s nod and was registered as an NBFC on March 13.

The NBFC approval will now enable Flipkart, as well as Flipkart-owned fintech app super.money, to disburse loans directly via Flipkart Finance. Flipkart and super.money, until now, relied on banks and other NBFCs, including Axis Bank and IDFC Bank, to distribute loans for buy-now-pay-later schemes, EMIs, and even small personal and business loans.

While the company did not divulge the details of the NBFC approval, according to a Reuters report, Flipkart Finance will start operating within a few months. It is currently setting up a team, including hiring key management personnel, and appointing board members while finalising its business plans.

Flipkart applied for the NBFC licence in 2022. According to the report, Flipkart plans to lend directly on the app and via super.money. It might also start lending to its sellers.

The development comes at a time when Flipkart is relocating its headquarters back to India from Singapore as the e-commerce giant prepares to file for an initial public offering (IPO). Flipkart had shifted its headquarters from Bengaluru to Singapore in 2011 to tap into greater foreign investment opportunities, benefit from tax efficiencies, and avoid bureaucratic and regulatory hurdles in India.

Flipkart was acquired by Walmart for $16 billion, which at the time was the largest cross-border M&A deal involving an Indian business and the largest foreign direct investment (FDI) in the country. It was valued at $37 billion last year when it raised $1 billion in a round led by Walmart.

In January, Flipkart’s rival Amazon India acquired fintech lending startup Axio in an all-cash deal for $200 million, after making a proposal to acquire Axio in December. The move was seen as part of Amazon’s broader strategy to increase its financial services offerings in India. It has applied for an NBFC licence as well, but it is yet to receive the RBI’s approval.