Today, the global economy is bearing the brunt of the ongoing trade war between China and the US. IMF has pointed out that by 2020, a full-blown trade war will cause a slowdown of around 0.8% to the global economy. The effects of a trade war, along with other macroeconomic factors, are already visible in the Indian market. A recent report by the World Bank has indicated that the cyclic slowdown in India is becoming severe, decreasing its growth outlook by 1.5%. It also hinted that the softening private consumption needs to be addressed by the nation along with the structural challenges.
Thankfully, this is a front that the nation's fintech sector is having a considerable impact on. India's fintech sector and the players operating in it are helping drive the national consumption by addressing the structural bottlenecks and increasing credit penetration with their tech-driven approach. Here are some of the ways in which they are doing so:
A leader in its domain, InCred extends loans that fulfils the end-to-end needs of an MSME. The platform is known for its quick and easy loan assessment and disbursement process with tailor-made products for different use cases. InCred provides Working Capital Loan of up to 12 months to manage cash flows, collateral-free business loan for up to 36 months, and even empowers its MSME customers to extend Channel Finance to their distributors and vendors.
Syntizen is one of the leading digital identity solutions providers in India. The platform provides a unique product Edo Suite for identity masking. Businesses get to easily comply with UIDAI to cloak Aadhaar Numbers before storing them. The system is driven by Machine Learning technology and can intelligently detect Aadhaar Cards in the database, extract their numbers, and mask their first 8 digits. This can also be done with the Edo Camera SDK as well, which can be integrated into customer on-boarding solutions and mask Aadhaar numbers in real-time during the customer acquisition process itself. Owing to the regulatory requirement, Edo Suite is experiencing superlative growth at present.
Gurgaon-based RupeeRedee is a new-age digital lending platform that leverages state-of-the-art technology and data sciences to make lending safe, quick and hassle-free for India’s massive populace of underserved customers. It has a unique feature of 100% paperless process of disbursing loans to customers at an average time period of 10 minutes. Its quick and easy application process requires minimum documentation and the customers can conveniently get access to small-ticket loans ranging from INR 5000 to INR 25000. The digital lending platform also has a new product in the pipeline, which will cater to individuals seeking larger loan amounts. RupeeRedee has also introduced RupeeRedee Elite Program for its exclusive customers, where the existing eligible customers get pre-approved plus other benefits under the loyalty program.
Satya MicroCapital Limited is an NBFC-MFI serving low-income entrepreneurs in India’s rural and urban areas. The firm operates on a Joint-Liability-Group-based model lending operation and primarily focuses on promoting women-preneurship by facilitating credit for women, with their husbands acting as co-borrowers. A group lending model allows people who are economically less privileged to form a collective and obtain credit by sharing the liabilities among themselves. Satya has, however, modified the JLG model to create a separate ‘Limited Liability Group (LLG) Model’, wherein the credit burden of defaulting clients on disciplined borrowers is limited to a certain extent. As per this model, disciplined borrowers have limited liability (maximum up to 10 per cent of the loan amount through joint liability) in the event of default by a delinquent member. Satya takes the ownership of such delinquencies and relieves the disciplined customers from the obligation of making payments on behalf of a delinquent customer. Hence, it ensures that capital unavailability does not come across as an impediment to entrepreneurship, especially within rural geographies.
XPay.Life powered by a blockchain-based transaction framework, XPay.Life covers the complete spectrum of bill payment services, with is unique products-Touch Screen Kiosk, Web, Mobile App, POS Device and Mobile ATP Van. The USP of XPay.Life is Bill Payment through Touch Screen Kiosk, which accepts cash as well as digital payments. Furthermore, as a fintech leader, XPay.Life simplifies the transaction and end-to-end customer journey through ‘one-click’ processing for transactions in digital channels.
The biggest challenge that MSMEs - especially the 'Micro' segment within it - is the sheer unavailability of financial support. This is because of the unavailability of conventional datasets to process microenterprise-centric loans. This is an area where AI-based lender HAPPY makes a massive difference. HAPPY taps unconventional datasets through its channel partnerships (which ranges from remittance players like POS vendors and Mobile Wallet players and even logistics operators) to extend quick and easy collateral-free loans to its loan applicants. The best aspect of the platform is that it processes loans in less than 1 minute, thereby empowering micro enterprises to access credit as and when they need.