June 30, 2016
Our aim is to effectively connect two set of stakeholders
1. Unserved/ underserved borrowers If we look at the current state of affairs, in the Indian scenario, the financial institutions do not cover the individuals with limited credit history (what we call 'thin file' cases) or individuals with no credit history (the 'no hit' cases) - these individuals in case of loan requirement scout for the unorganized market for fulfillment of their requirements. The lenders in this market are highly unorganized and cost of borrowing can go upto 4-5% per month. Further, certain set of loans are not entertained by the financial institutions, especially when it comes to cases of startup funding. We would like to effectively cater to this population - who despite having a good profile - have either no or bad credit score. Through an effective P2P mechanism we would like all (good profile) individuals to be able to borrow efficiently and at lower costs.
2. From Investors point of view: While there are set of un-served borrowers; there are individuals with short/ long term excess cash and looking for investments at a higher rate of return. Traditional products give an effective rate of return of 5-7% (post tax) while in case of equities, while the rate of return can reach upto 20-25%, the markets are highly volatile. In case of peer-to-peer lending there is a possibility of earning upto 30% rate of return and that too with a fixed monthly cash inflow.
The motivation came from solving the problem of Financial Inclusion. If you look around there are many people who require capital but do not have access to it. If you look at our platform we cater to individuals or Micro and Small enterprises requiring capital for multiple purposes including health, debt consolidation etc.
Working in the Indian online space and that too with a product which involves money is itself a big challenge. This emanates from the fact that Indians are traditionally very conservative. The biggest factor for our success today and in future shall be the trust that our platform and our team can offer to our users. One has to understand that this a marketplace and no money is transacted over the platform. Further, we donot collect money from lenders or borrowers - the transaction happen between both the parties, we only act as facilitators. Our focus has been to ensure that we communicate regularly and maintain 100% transparency with our users.
June 29, 2016