German retailer, Metro Cash & Carry is trying to extend credit facility to its customers, mostly Kiranas [local mom-pop grocery retailers] as they feel the heat of liquidity and credit crunch.
Metro has tied up with SKS Micro Finance in Hyderabad to offer credit lines to Kiranas. SKS Micro Finance is funded by VCs like Vinod Khosla, Unitus Equity Fund, SIDBI and Kismet Capital. Mr. James Scott, Regional Operating Officer @ Metro said,
The pilot project is a kind of learning curve for us. We wish to be close to our customers and support them since many are increasingly getting affected due to the economic situation. We will tie up with third-party financial institutions who will offer such financing. In fact, in our kirana training programmes, we are also providing inputs on how to seek finance support. Such schemes may also be rolled out for institutional buyers.
In Turkey metro already has a Credit Card for Kiranas and such programme cannot be ruled out in India. Hopefully our Kirana store owners will take the best use and stay prompt in their re-payments.