How this Gurugram-based fintech lender is helping underserved borrowers get small loans

Despite having more than 30 banks and 90 commercial banks, and thousands of fintech and financial services companies, India is a underpenetrated Marlet when it comes to formal credit. Ironically, there is a huge, unorganized loan market that lends at grueling rates, essentially exploiting those in dire need of credit.

Most people depend on these unorganized predatory lenders because they are unable to qualify for a bank loan because they don’t have a credit portfolio or “solvency”. Students, job seekers, self-employed, part-timers, or people who don’t have a bank account are most likely to be turned down for a bank loan because they don’t have a profile yet loan with CIBIL.

It didn’t go well with Artem Andreev, National Chief of Inasmuch asRupeeRedeeInasmuch as, for whom access to credit must be democratic.

RupeeRedee solves this problem. Founded in 2018 by Jitin Bhasin who left his role in 2020, RupeeRedee is essentially a digital lending platform that targets first-to-credit customers and those who have been unable to obtain a line of credit from financial institutions.

The startup kicks off users who don’t have a CIBIL score with a small ticket-sized loan at Rs 2,000, and offers a maximum of Rs 25,000 to underserved customers. Being fully digital allows the fintech company to offer its services through PIN codes in India, and it disburses funds almost immediately.

“We started with a mission to make loans accessible to all parts of our country, offering small loans to the majority, and through this we also help them build their credit score,” Artem said. Your story.

RupeeRedee almost saw three million installs from the Google PlayStore, and hopes to reach five million by the end of the current fiscal year. To date, it has disbursed nearly three million loans to individuals through its online platform, end-to-end, including paperwork and disbursements.

Differentiation and revenue model

A unit of International digital finance, which has more than 20 international fintech brands across multiple countries, RupeeRedee’s Artem says the startup offers loans at industry-competitive rates – between 18% and 36% – and follows all RBI guidelines.

RupeeRedee derives its income from interest rates, as do most lenders. This reached the break-even point in the first year of operation, and is currently profitable.

“We serve 50-60% repeat customers every month, and our target audience is mostly millennials with an active PAN card. The majority of our customers are low-wage people from Tier 2-3 cities,” says Artem .

After raising nearly $1 million in debt in 2021, Artem says the company is is looking to raise an additional $3 million in 2022.

“‘Good debt’ is the need now because equity is the most expensive form of financing. We want to build more credibility in the market by successfully servicing this debt,” he added.

The company also raised $6 million from its parent company, Digital Finance International.

Although Artem did not specify the amount of the loan RupeeRedee had disbursed so far, he said his aim was to close the loan book at Rs 250 crore in this financial year.

The Gurugram-based company competes with a host of lending platforms in India including Inasmuch asCreditBeeInasmuch as, Inasmuch asKissInasmuch as, Inasmuch asSalaryBeforeInasmuch as, LoanTap, among many others. Its competitors also include online financial platforms such as Inasmuch asSimpleInasmuch as, Inasmuch asCapital floatInasmuch as, Inasmuch asLazy PayInasmuch as etc who offer BNPL – buy now, pay later loans – which are also small loans.

Last year, the RBI imposed strict rules checks and balances in place for write off and prevent the public against fraudulent loan applications and platforms that have used brute force to recover loans from borrowers in the event of late repayment or credit default.

The central bank said borrowers should independently ascertain whether the lender is approved by the RBI, keep an eye out for red flags including checking user reviews on Google and other platforms, carefully reading the terms and conditions, refusing to accept loans from unauthorized sources, and monitoring for anything else that they may find inconsistent or unacceptable.

You can find more documentation on the RBI guidelines here.

Between 2020 and 2025, India The personal loan market is expected to grow by around 10%.

During the period of FY 2017-2021, the loan market grew by 100% to Rs 156.9 lakh crore, according to a report by Indian credit bureau CRIF High Mark, titled “How India Lends “. Of this loan portfolio of Rs 156.9 lakh crore, small personal loans (less than Rs 1 lakh) took a 49% share and led the overall growth, compared to retail and commercial loans.

With India’s growing appetite for personal credit, startups such as RupeeRedee are expected to continue to see substantial growth and traction.

Edited by Teja Lele Desai

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