Data points are put into the company’s proprietary framework to draw credit scores and co-create products with lenders.
Chennai-based CreditMantri, a fintech focused on delivering Credit Management services, has been a great case in point for how technology and digital medium can be effectively leveraged. The company has been helping millions of customers take informed decisions through its indigenous platform, with the combined power of data science and analytics.
Ranjith Punja, Co-founder & CEO of CreditMantri, takes us through the company’s data-driven journey.
Q: CreditMantri today has more than 10 million customers. How critical is data analytics for you in providing the right services and experience to customers, and also in addressing issues around bad credits?
A: The starting point for us at CreditMantri is to profile customers using institutional data (bureau and bank), statutory data (PAN, Aadhaar, GST, utility bills), and user declared data (mobile, SMS, social). We leverage a federated data approach to source real time data using customer consent, through external API’s. In a happy flow, we collect 3,000+ data points that are put into a CreditMantri proprietary framework that we call the ASCII pillars of credit – Ability, Stability, Contactability, Intent and ID – typically what lenders look at while evaluating new credit applications. This data has helped us co-create products with lenders and it helps lenders underwrite, verify and skip trace customers more efficiently and at a lower cost.
For the underserved segments (credit challenged, new to credit and low income) we utilize our proprietary framework and are computing a lendability, verification and an income estimation score. This helps us to co-create products with lenders willing to lend to the underserved segments. We also utilize data analytics to drive product/service interest, and this helps us stack resources appropriately against the different segments.
Specifically for credit challenged customers, we are able to determine the profile of customers that are likely to resurrect their credit health and repay their original lender. We are also working on determining the impact of various actions taken on a customer’s credit score.
Lastly, data science and analytics helps us narrow down on better revenue earning customers and to ascertain their preferred channel of engagement. This ensures resource allocation is aligned, so that expensive calling resources are focussed on delivering the right set of conversions.
Q: What are the other key technology investments you have made and how is it helping CreditMantri?
A: Besides the proprietary scores, we have developed propensity models, use web BOTS, IVR, propensity models to drive DIY and avoid linearity in our business. Many of these models use AI and machine learning resulting in better match rates and predictability.
Q: What are your thoughts on the digital disruption in the BFSI ecosystem? There is a very positive trend of fintechs like CreditMantri very successfully catering to the needs of the market. What will drive the digital space ahead?
A: Digital data is already driving disruption in the BFSI space – from sourcing, targeting, underwriting, monitoring to paying, investing, insuring, etc.. Just like cars, taxis, hotel rooms are shared already, fintechs will lead the charge with financial services also being shared, by efficiently matching providers and users of capital. The providers may not necessarily always be banks. While the data is likely to become available, piecing it together in a meaningful manner in order to make efficient decisions will be the most critical component.
Q: What are the three key factors that contributed to the company’s fast growth?
A: One factor that helped us in the beginning is that we were the pioneers in the industry to provide a credit score online, real time and for free, to anyone who registered on our website. At that time, a credit score was only offered by the bureaus for a fee. This was, and continues to be, a big draw to our website.
The second factor that contributed to growth was the availability of venture funding from Elevar, IDG, Accion, Quona and Newid. This provided us with the ability to attract customers to our website. We invested in creating awareness and educating our customers about the importance of staying credit healthy.
Lastly, it is our mission to simplify credit decision making and we are working to make financial progress possible for the underserved. This is a large and unaddressed segment and solving for this segment meaningfully has played a significant role in CreditMantri’s role.
Q: What challenges do you see from a regulatory or policy front, which needs to be addressed to move forward?A: The government is definitely taking the right steps to frame policy and regulation. Data privacy and data security are the key challenges - the laws around these and the effective implementation and monitoring of this is vital.