Credit card killer? This ICICI Bank facility offers interest-free credit even when bank balance is zero

Named ‘PayLater by ICICI Bank’, it enables eligible customers to shop online, pay bills and pay to any merchant UPI ID at physical stores instantly.

Cardless Credit: ‘PayLater’ will currently be available to pre-approved and qualified customers of ICICI Bank.

Forget credit cards. There is a good news for ICICI Bank customers. You can now shop up to Rs 20,000 using your ICICI Bank UPI ID even if you don't have money in your account. Yes, you read it right. ICICI Bank today announced the launch of an instant digital credit facility to enable customers to buy small-ticket items immediately in a completely digital manner.

Named ‘PayLater by ICICI Bank’, it enables eligible customers to shop online, pay bills and pay to any merchant UPI ID at physical stores instantly. This facility leverages upon the technology unveiled in BHIM UPI 2.0 to extend digital credit to customers for making payments using UPI.

"ICICI Bank was the first bank to enter the instant small ticket digital lending segment by partnering with a large fintech firm last year. It is now extending that programme leveraging upon the UPI 2.0 rail roads. This offer is yet another initiative of the Bank to consolidate its leadership position in the small-ticket digital credit market which has the potential to grow manifold in near future," said the bank in a statement.

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Through this proposition, ICICI Bank is expected to enable as many as few lakh customers to buy products of their choice during this festive season.

"PayLater is targeted at the young and millennial customers who want everything digitally and instantaneously, including credit. An invite-only facility, it is instantly available to pre-approved and qualified customers up to Rs. 20,000. Customers can use it immediately to shop online on e-commerce sites, entertainment, travel, accommodation bookings among others. Customers can also make payments at physical stores through PayLater using the UPI platform," it added.

“Two, millions of young Indians are now buying products online. We have combined these two insights to bring out a novel proposition of giving short term digital credit, instantly. India’s digital lending market is estimated to offer a $1 trillion opportunity over the next five years. Keeping this in view, we are delighted to introduce ‘PayLater’, an instant digital credit line which will enable our customers to undertake small ticket purchases instantly," said B Madhivanan, Group Executive and Chief Technology & Digital Officer, ICICI Bank.

How to avail the benefit?

‘PayLater’ will currently be available to pre-approved and qualified customers of ICICI Bank. Customers can sign up for the facility through iMobile, the Bank’s mobile banking application. The entire process of signing up for the credit facility, sanctioning of the amount, account creation and the subsequent use of the facility is fulfilled in a completely digital and paperless manner and can be completed in a matter of few minutes.

Available 24X7 on all days, ‘PayLater’ will use ICICI Bank’s new Big Data-based algorithm for undertaking credit assessment of customers. The algorithm uses an intelligent combination of parameters including the Credit Bureau check, balance patterns, vintage with the Bank, among others to ascertain the credit-worthiness of a customer.

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"The Bank will offer up to 45 days interest-free credit limit to eligible customers. It ranges from Rs 5,000 to Rs 20,000 based on eligibility of the customer. Once the credit limit is set up for a customer, a consolidated bill is generated on the first day of the subsequent month, which has to be paid by the 15th day of the same month. Customers can seamlessly repay their dues by setting up an auto debit facility with their account or by simply initiating a transfer through their internet banking account," said the bank.

The bank said that the PayLater will provide a customer with an instant access to short-term funds, eliminating the hassle of any paperwork.

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