Venture capital funding and angel investors are fast drying up, and e-commerce majors are scuttling for money to fund their day-to-day operations.
Informing about the development, Vijay Shekhar Sharma, founder, Paytm said, “This is a treasury management move for working capital. While adequate funds are there, it is advised by our finance teams to get these credit lines for working capital on the back of security, such as FDs (fixed deposits), mutual funds, etc., in order to conserve cash.”
According to the latest documents filed by Paytm with the Registrar of Companies (RoC), the company has pledged cash assets as security with the bank. Last year, Paytm had taken a small loan of Rs 15 crore for working capital requirements from HDFC Bank which has been repaid by the Noida-based company, RoC documents show.
In a similar move last week, Flipkart had also received a loan of Rs 450 crore from HDFC Bank on its fixed deposit.