It is a scenario that many youngsters, professionals or budding entrepreneurs have encountered – inability to get finance or credit from traditional financial institutions. Falling under the ‘new to credit’ or NTC category, this challenge compels them to seek out informal credit options who charge higher rate of interest.
Sensing an opportunity in this space, many non-banking financial companies (NBFC) and fintechs are stepping in to help NTCs access credit. One market report found that in FY 2019, NBFCs contributed 40 percent of new loan accounts in retail, consumer, housing, and small business segments.
Here are five fintechs who leverage data and analytics to offer finance and credit online to a wide demography, thereby boosting financial inclusion.
IndiaLends: A digital lending and borrowing marketplace, IndiaLends offers credit cards as well as personal and unsecured loans without guarantors. It is now exploring the possibility of ecommerce credit. Here, instead of giving credit to the customer, funds will be simply transferred to the e-commerce platform. The promoters believe this model will save IndiaLends the hassles involved in underwriting and help it disburses loans faster.
LoanTap: An online NBFC, LoanTap offers customized personal loans including EMI-free loan, rental deposit loan and holiday loan to salaried professionals and millennials. While designing financial products, it focuses on a customer’s cash flow needs and compensation flexibility to minimize repayment risk.
MoneyTap: MoneyTap offers customers the option of availing multiple loans through a single line of credit from a financial institution. By leveraging technology innovation, it has reduced customer onboarding costs by over 55 percent while strengthening partnerships with various companies.
PayU: PayU provides payment technology to online merchants. It also has LazyPay, which offers instant credit on online purchases. This basically means that customers can ‘buy now, pay later’ with a single click without worrying about adding their card details, or using an OTP to finalize the transaction.
PaySense: Consumer lending platform, PaySense, provides loans ranging from INR 5000 to INR 5 lakhs with five days as its average loan disbursal processing period. Since inception, it has disbursed 170,000 loans. Its 120,000-strong customer base comprises salaried professionals and self-employed individuals.
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