Stimulated by India’s strong marching wave in the fields of Jan-Dhan (Bank Accounts), Aadhar (KYC solutions) and Mobile (alternative data/communications), Ritesh, Deepak and I (classmate from Indian School of Business 2009) started FlexiLoans .com in 2016 to serve deserving but underserved micro and small businesses across India using the facility. technology infrastructure and data-powered credit guarantees for superior customer journeys.
When we met the first set of e-commerce and commerce platforms to distribute digital business loans using alt-data within 48 hours, we were greeted with a rug. red. However, our potential investors/lenders wanting to see traction and credit behavior gave us the first lesson that lending risk pays off more than book growth and potential. .
Soon, FlexiLoans has become one of the leading lenders for e-commerce merchants selling on platforms like Shopclues, Snapdeal, Flipkart, Amazon, Paytm etc. During 2016- 2017, India’s MSMEs saw 2 major macro changes: a) monetization stopped; and (b) Introduction of GST – important changes for small businesses in India.
We have developed alternative underwriting models based on POS payments, e-commerce sales to ensure seamless credit delivery, and data-driven eligibility calculations for credits. loan, which was unprecedented until then. The Covid period from 2020-22 continues to drive digital adoption by Indian businesses and today we receive over 3,500,000 monthly applications and over 100,000 monthly visits. into our digital platforms. The lesson to be learned here is that India is a very large underserved and high potential market that is waiting for a disruption in lending activity as defined by lenders such as FlexiLoans. .com leverages data and technology to service viable loans
In 2019, India’s NFBCs suffered a major setback following the PNB and ILFS crisis as funding literally dried up and sanctions that would take weeks to disburse started to drag on. Monthly. We then learned the hard lesson that liability and liquidity management is one of the most difficult and core tasks at Lending and if not established as a disciplinary process, may impede growth. We have developed co-lending solutions for our clients with a number of well-known banks and NBFCs, and these will come in handy in 2021-22 as the refinancing scenario tight due to covid but 70% of our AUM growth has been seamlessly met by our partners to lenders through our co-lending platform. Our franchisees are diversified today with over 25 Banks and Financial Institutions lending directly to us and many co-lending partners.
Ultimately, the COVID phase is a real test for any lender, and we’ve learned the virtues of empathy, communication, and technology in our Collection efforts. We keep in constant contact with our customers, expand our reach to customers, restructure their loans to a customer-savvy level, and achieve a credit cost of less than 5% even in the most difficult times. year of Covid and the fewest customer escalation. We used technology tools to remind customers, receive payments and update them to their track record.
To sum up, the past 6+ years have seen one of the toughest macroeconomic environments for India’s MSMEs but also seen the Digital Stack of India gain strength. greatly thanks to the support of the management agency. We are currently one of the leading Fintech Lenders in the country with over Rs 1,000 AUM, over 4,000 crore annual disbursement rate and among the few profitable fintech backed by trust and support of our valued customers and stakeholders. In lending activities, the possibility of increased risk sensitivity compared to the loan book is assessed.
Manish Lunia is the co-founder of FlexiLoans.com