Ola drivers can now repay loans on daily basis

Loan repayments to happen through a first of its kind daily installment scheme

• Lower down-payment, easier documentation and 24-hr loan approval offered
• Ola expects over 100,000 driver entrepreneurs to enroll under this program in the next couple of years, pan-India.

Hyderabad: In a move that will forever change the way financing for driver-entrepreneurs shall happen in the organized personal transportation space,Ola, India’s leading mobile app for intermediary public transport, today announced the launch of ‘Ola Pragati’in association with India’s largest financial institution,the State Bank of India. Under the Ola Pragati program, SBI will offer car loans to drivers on Ola’s platform with a daily repayment scheme as against the current practice of an EMI. Drivers on the Ola platform will also benefit from lower down payment of just 10%, 24-hour loan approval from SBI and easier documentation. Ola expects atleast 100,000 driver entrepreneurs enrolling under the Ola Pragati program in the next couple of years from across the country.

This new program recognizes that EMIs are better suited for salaried individuals and a driver entrepreneur who earns a daily revenue, will have higher comfort in paying his loan daily like every other expense. For the driver, who is an entrepreneur himself, this will ensure better financial discipline as well as reduce the interest component payable,substantially, in the long run. For the financing institution, such a product gives better visibility of loan repayment and more lending comfort. This program will work in sync with the daily settlement process that Ola follows with drivers. Ola will work with SBI by consistently sharing daily revenue and payment details of drivers in real time.

According to Anand Subramanian, Director–Marketing Communications at Ola,"Ola focuses on nurturing micro entrepreneurship in the driver ecosystem. The Ola Pragati program with SBI will enable drivers to buy a car and turn entrepreneurs with an attractive repayment option that is better suited for them. This initiative aims to open up lucrative means of earning a livelihood for a lot of drivers due to benefits at multiple levels thus helping in improving their socio-economic status. Drivers will now stand to benefit from Ola's technology and increased access to capital and revenues that will help them grow faster."

Mr. C.R. Shashi Kumar, Chief General Manager of Andhra Pradesh and Telangana at State Bank of India said, “SBI and Ola have a shared objective of nurturing entrepreneurship. Ola has grown from strength to strength in a short span of four years and has impacted the lives of thousands of driver entrepreneurs. As India’s largest bank we take great pride in being able to create an inclusive ecosystem for banking. We see a great opportunity in Ola Pragati for the youth interested in pursuing driving as a career. With Ola giving them revenue opportunity and SBI providing easy financing, drivers can grow as entrepreneurs”

These loans will be covered under the Credit Guarantee Fund Trust for Micro and Small Enterprises. Under the cover, if a borrower fails to discharge his liabilities to the lender, the Trust makes good the loss incurred by the lender for up to 85 per cent of the credit facility.

Ola has come up with several initiatives in the past 2 years to foster entrepreneurship amongst drivers on its platform. Recently, the company had set up a fund of Rs. 100 crore to enable drivers buy their own cars and turn driver entrepreneurs. Today, over 70% of the drivers on the Ola platform are entrepreneurs themselves; many, through car purchases assisted by Ola, from companies like Nissan, Tata, Ford, Maruti and Mahindra. Ola has also created a strong network of manufacturers and financial institutions to enable drivers to buy cars at better than market rates. Over 15,000 drivers, across the country, have already benefitted from such initiatives in the past. This association with SBI is another major step in this direction.