Arzooo plans fintech solution for partner stores to offer credit days for payment on product buys

Retail-tech startup Arzooo will soon launch a credit-driven fintech solution integrated with its B2B commerce platform that aims to create a working capital cushion for about 10,000 partner stores on its network, by allowing them certain number of days to pay for the products they bought.Arzooo said about 500 stores on its platform have already signed up for the product in the pilot phase, and that the solution will be available to the full stack of stores by July.

Retail-tech startup Arzooo will soon launch a credit-driven fintech solution integrated with its B2B commerce platform that aims to create a working capital cushion for about 10,000 partner stores on its network, by allowing them certain number of days to pay for the products they bought.

Arzooo said about 500 stores on its platform have already signed up for the product in the pilot phase, and that the solution will be available to the full stack of stores by July. It is partnering with non-banking financial companies (NBFCs) for building the product, and talks are also on with other banks.

Given the pandemic-induced uncertainties and working capital squeeze faced by businesses at large, the solution is expected to offer its partner stores a level of comfort.

''We are creating a product which will integrate fintech solution with commerce platform and offer a working capital cushion for our partner stores,'' Khushnud Khan, co-founder and CEO of Arzooo, told PTI.

Arzooo's platform empowers physical retailers to compete and grow against their online peers. Its tech platform aims to solve the problems of selection, price, and complex supply chain and sourcing issues for offline retailers in consumer electronics space.

The company has a virtual inventory solution and large suppliers in back-end, including brands, national distributors and large retailers. The business-to-business (B2B) commerce platform enables its partner stores, that is physical retailers, to offer their customers a wide selection of products, better prices and quick delivery, without them having to stock every item.

Currently, the partner stores have to pay upfront or on-delivery for products ordered and bought on its platform.

''But, that keeps their working capital management tight. So, we are coming out with a fintech, credit-driven product, which means we are partnering with financial institutions and building this product where a store will get access to a credit mechanism.

''They can buy, and based on underwriting and credibility records, they will get credit days, anything between 21-45 days worth of credit,'' he said.

The company expects the new product to be a sweetner for partner stores, allowing them to manage working capital more efficiently.

''They can buy the goods, sell them and pay it back. So, it allows partners to work with massive cushion to operate working capital better,'' Khan said.

Nearly 500 stores have signed up in the ongoing pilot phase, and the company is looking to make it available to all partner stores by July.

''About 500 stores have signed up for Arzooo credit. So, we selected these stores and to them, we have given visibility of this product. Almost 200 stores are trying out the new product, and rest will happen this quarter. Then we will go commercial by July making it available to all stores on our platform,'' Khan said.

Last week, Arzooo announced the launch of in-house logistics service, that will manage full logistics right from first mile service to last mile delivery of goods for its partner stores across the country.

The in-house logistics service, Arzooo Express, has been launched with an investment of USD 2 million.

So far, Arzooo has raised about USD 15 million of capital. This includes, `Series A' round of USD 7.5 million funding led by WRVI Capital along with its existing investors in October 2020, followed by the investment from ZOOM video founder Eric Yuan. In February this year, Arzooo secured USD 6 million from Trifecta Capital.