SML Mahindra and Indian Bank partner to digitise dealer finance with supply chain platform

SML Mahindra Limited has signed an MoU with Indian Bank to provide digital inventory and working capital financing to its dealer network, leveraging supply chain finance technology to streamline access to funds and enhance operational efficiency.

SML Mahindra Limited has signed a Memorandum of Understanding with Indian Bank to offer inventory and working capital finance to its authorised dealers, the company announced. According to the report by Commercial Vehicle, the ...

tie‑up will use Indian Bank’s Supply Chain Finance (SCF) platform to provide digitally enabled inventory funding on competitive terms to dealers across SML Mahindra’s network of more than 110 3S dealerships.

The MoU was signed by Prashant Kumar, CGM – Marketing at SML Mahindra, and Jatinder Pal Singh Talwar, AGM – Indian Bank, FGMO Chandigarh. The parties say the arrangement is intended to simplify and accelerate dealer access to funds by replacing traditional, paper‑heavy processes with a fully digital workflow, improving turnaround times and transparency. Dealers will need to complete standard KYC formalities and submit financial documentation, such as balance sheets and bank statements, as part of the bank’s credit assessment.

The agreement reflects a broader industry move toward bank partnerships and digitised channel finance. According to a Maruti Suzuki press release, Maruti Suzuki India also partnered with Indian Bank to develop personalised working‑capital solutions for its dealer network, with the bank citing its ability to provide dealers easy access to finance at favourable terms. Major vehicle manufacturers have increasingly sought preferred financier arrangements or co‑lending and supply‑chain financing models to shore up dealer liquidity and accelerate vehicle movement from factory to showroom.

Mahindra Group companies have pursued similar financial tie‑ups in recent years. Company announcements show Mahindra & Mahindra signed a Preferred Financier agreement with South Indian Bank to expand vehicle‑finance options at the dealer level, while Mahindra Finance has entered into a co‑lending partnership with State Bank of India and formed technology alliances to speed customer onboarding. Industry data shows such partnerships are aimed at combining manufacturers’ distribution reach with banks’ capital and regulatory expertise to reduce dealer stress, support inventory turns and expand retail finance availability.

For SML Mahindra’s dealers, the proposed benefits include tailored channel finance, quicker processing through digital enablement and access to funds on competitive terms to support scaling operations and inventory management. The company and bank say dealers should coordinate with SML Mahindra’s dealer development team or the designated Indian Bank business vertical to initiate the facility.

While manufacturers and banks point to improved efficiency and dealer support from SCF and co‑lending arrangements, independent analysts caution that the effectiveness of such programmes depends on credit underwriting standards, pricing, and operational execution by banks and dealer networks. According to the Commercial Vehicle report, SML Mahindra’s initiative is positioned as a strategic step to strengthen its dealer ecosystem by reducing traditional financing hurdles through digital supply‑chain finance.

Source: Noah Wire Services