Bajaj Auto Ltd. country’s fastest growing automobile company has tied-up with State Bank of India, the country’s largest bank to offer inventory finance to its dealers. Through this tie-up, a cash credit facility ranging between Rs. 25 lakh to Rs. 5 crore will be made available to Bajaj Auto’s dealers who predominantly fall in the ‘Small & Medium Enterprise’ (SME) category for State Bank of India. The loans will be sanctioned and disbursed subject to necessary approvals at a competitive interest rate.
The inventory finance innovation comes on the back of a spectacular sales performance recording highest ever sales of more than 2.4 million motorcycles during 2010-2011. With ambitious growth plans this year as well, higher inventories at the dealer level as well as secondary network are expected during this fiscal. Higher inventories would mean higher working capital requirements at the dealer level.
S. Sridhar, President, Motorcycles, Bajaj Auto, said: “Timely availability of finance is a crucial component in the scheme of things. Our domestic bike sales have grown at 35% last year. With new models and variants being launched and increased acceptance of existing models we will need to ensure adequate working capital for dealers. Considering these requirements we have taken proactive steps to provide critical resources, including financing through SBI, to our dealers.”
He added: “We are glad to partner with SBI who have the largest network of more than 13,000 branches spread across the nook and corner of the country. Besides, their newly developed centralized electronic Dealer Finance Solution is best suited for our dealers who are also positioned pan-India.”
Vimal Sumbly, Sales Head, Bajaj Auto, said: “The tie-up with SBI for inventory financing will ease the financial stress that builds up for any dealer. SBI will be categorizing these loans under their SME segment and hence a host of benefits will accrue to Bajaj Auto dealers. Our aim is to keep the sales pipeline moving smoothly and to aid our dealer partners with best possible arsenal.”
Manas Kumar Nag, chief general manager (Small & Medium Enterprises), SBI said: “The electronic Dealer Finance platform is a premium product from SBI through which we shall partner the growth ambitions of Bajaj Auto by providing the best-in-class customer experience to their dealers.”
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