IPO-bound CarDekho’s fintech arm Rupyy to enter into personal-loan segment

Rupyy, which is focused on used and new car loans, has looking to move into new categories, including scaling up loans for commercial vehicles.

Rupyy, the digital lending arm of CarDekho group, is venturing into personal lending category as it looks to expand revenues beyond auto loans.

The fintech, which focusses on financing of pre-owned and new vehicles, had launched pilots for the category in November.

“We will focus on salaried consumers to begin with and give out small-ticket personal loans less than Rs 40,000. The idea is to monetise on CarDekho’s large organic captive base of over 40-50 million active uses,” Namit Jain, Co-founder and CEO at Rupyy told Moneycontrol.

The CEO said the new category is still in the discovery mode and scaling up will happen in near future with the introduction of personal loans of Rs 2 lakh and above.

“We already have a 15 percent market share in pre-owned vehicle loans segment. We don’t want to restrict Rupyy to car financing and cement its position as an end-to end integrated financing platform,” he added.

A small percentage of the loans will be given out from Rupyy’s books via its NBFC, while majority will come from existing and new co-lending partnership with around 40 lenders.

These includes banks such as Axis, IDFC, HDFC, Kotak, IndusInd and also lenders like Poonawalla Fincorp and Cholamandalam.

Girnar Software, Cardekho's parent company, has an NBFC licence.

Peak XV Partners-backed Cardekho Group has been sharpening its focus on its fintech entities—Rupyy and InsuranceDekho — to push growth numbers and hit the profitability mark as it sets base for a potential IPO.

The group’s revenue jump of 46 percent at Rs 2,331 crore in FY23 was credited to the growing business of both the subsidiaries, even as it ceased its used car retail business citing "inviable unit economics".

“...the group has enhanced its focus on providing financing and insurance solutions across its ecosystem,” said Amit Jain, cofounder and chief executive of CarDekho group while announcing the annual results.

Profitable since FY22, Rupyy claims to have secured a market share of 15 percent in used car loans and will be closing FY24 with an annualised loan disbursal of Rs 15,000 crore with over 3.8 lakh customers, the CEO said.

InsuranceDekho touched an annualised premium run rate of Rs 3,600 crore with 1.5 lakh agents, and is pinning profitability in the current fiscal.

At the group level, the autotech unicorn claims that its core business turned Ebitda positive in the first two quarters of FY24, and full profitability for the second quarter.

It is expecting a revenue jump of over 60 percent in the current financial year.

Ebitda is short for earnings before interest, taxes, depreciation, and amortisation.

Scaling commercial, EV financing

CarDekho introduced Rupyy  in 2022 to cater to the growing auto loan market.

A key revenue driver, Rupyy has been working on expanding horizontally with new categories over the last 12 months, including electric vehicle (EV) and commercial vehicle loans.

It forayed into EVs in 2023, partnering with leading OEMs and multi-brand outlets (MBOs) in the industry such as Pure EV, Trinity, Hero Electric, Electric and Ampere.

“Over and above used cars, we expanded into much larger-new car loan segment three years back and it now contribute almost 30-35 percent to the overall volumes. We introduced EV financing last year itself and are still trying to understand the category better, as it has been going through its own share of headwinds,” Jain said.

Besides unsecured lending, the company will go big on commercial vehicles loans in FY25 to boost market share.

“It’s (commercial vehicle loans) a 1.2 lakh crore market but the customer experience is fairly broken. This will be our core focus for FY25," Jain added.

On fundraise from parent group, the CEO said the company is well-capitalised for the next 12 months and will continue to pump money internally.