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HDFC Bank has bought a 1.5% stake in CSC Grameen e-Store for an undisclosed amount. This comes after Tata Digital had purchased a similar stake in the government-run rural e-commerce venture in December. India’s largest private sector lender is looking at the platform to extend the reach of its products and services especially the banking portfolio in rural areas, top executives said.
The Grameen e-Store, launched in April last year, offers a huge range of products including local handicrafts, groceries, and consumer durables in far-flung areas. It has touched revenue of Rs 250 crore within a year of launch. This is a strategic investment through a small stake which “shows our commitment to the rural commerce model,” Smita Bhagat, group head, government and institutional business, e-commerce, and startups, HDFC Bank said. “It is a clear example of what a partnership between government and private players can do. Look at its potential for transforming the lives of consumers and we benefit through its reach into the rural areas. It’s a win and win for both,” Bhagat added.
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The e-store is run by the 400,000-odd Common Service Centres (CSCs) under the Ministry of Electronics and IT (MeitY). The ambitious rural e-commerce venture has brought on board big brands such as white goods retailer Tata Croma and leading financier HDFC Bank to scale up operations. It already has partnerships with large multinationals such as Pepsi, Coca-Cola, and Bharat Petroleum. HDFC Bank’s Bhagat said since nearly 60-70% of the country’s population resides in semi-urban and rural areas, India will not be able to grow at a good pace unless the rural economy grows.
