Fintech Startup ‘MoneyTap’ Plans To Scale With Data-Backed Lending Models

The fintech space in India has been booming at a huge scale, and the market is expected to reach a figure of around $31 billion by this year-end.  Anuj Kacker, COO and co-founder of MoneyTap gives us a clear insight into how things are shaping up in the fintech domain…

How do you think is the fintech sector is going to surge in the near future?

Lending by fintech startups has boosted financial inclusion, especially for consumers and businesses otherwise unlikely to get access to conventional finance. The fintech lending industry is constantly innovating and is set to grow to $100 billion by 2023. Digital lending has the potential to unlock the underserved segments, for e.g, those who are NTC (New To Credit) and do not have a credit score yet. A range of entrants and business models can be successful in tapping the growing market.

What is the exclusiveness of your startup, that’s unique from other gigantic players in the market?

We cater to the credit needs of middle-class India by providing flexible & quick credit on mobile at affordable interest rates and convenient EMIs.

MoneyTap has the best combination of quick credit and smooth process – we provide the power of flexible borrowing to our consumers with a ‘Line of Credit’. This is a one-of-a-kind product in the Indian market. The line of credit is very different from a regular Personal Loan or a Credit Card as it combines both offerings in one product, at a competitive rate of interest.

Getting the MoneyTap credit line is also an easy process and works without a need for collaterals or guarantors. Customers download the MoneyTap app for free and then a patent-pending propriety ChatBot comes up and chats with a customer to help them apply for the credit line. Smart algorithms help them get an instant update on their credit eligibility. Once the documents are collected and verified, the line of credit is issued to the customer.

The USP of the MoneyTap app is that customers can choose to borrow any amount they need from their credit line. For e.g, if they have been approved for a credit line of ₹2 Lakh, they can borrow as low as ₹3,000 from it, with the repayment EMI tenure of their choice (2-36 months). And the best part is – once they repay the amount, the credit line gets replenished automatically and is available for use again.

Unlike the high interest rates on credit cards or multiple rounds of paperwork needed for a one-time personal loan, the MoneyTap app lets customers borrow and repay without hassles or delays.

More details about the MoneyTap app:

Platforms: Android, iOS, Web

Languages: English, Hindi, Tamil, Telugu, Kannada, Gujarati, Marathi

Downloads: 10 Million+ | Rating: 4.3

What is the latest mode of technology that you are catering to?

In our credit line product, AI and ML are integrated right from customer targeting and on-boarding to document verification and collections. We use AI and ML algorithms to generate alternate data scorecards, which form the basis for our lending in addition to CIBIL scores. We have an industry-best NPA average of less than 1%. This happens primarily due to AI and ML predictions in creating customer profiles and analysing risk and repayment behaviour patterns.

How important do you think is it for people to rely on technology? Are there any major follies per se?

With heightened digital awareness, people are increasingly relying on technology to ease their lives and save time in their daily lives. By tapping into the power of automation and artificial intelligence, businesses can create customised  offerings for customers.

Individuals and businesses alike need to protect against fraud and hacks in the system. Creating different passwords for different apps/ accounts / regularly changing passwords are just the basic precautions that can be taken to prevent identity theft or fraud. Businesses need to ensure the payment gateways and OTP generation process is secure at all times.

Coming to the financial perspective, are you a bootstrapped venture? If not, kindly elucidate on the nature and amount of funding raised.

MoneyTap is a Series B funded startup. We got a Series A funding of $12.3 Million, led by Sequoia India, New Enterprise Associates (NEA), and Prime Venture Partners in 2017. Recently, we have secured ₹500 crore in our Series B round of funding (in equity and debt). The Equity Series B round is led by global funds, including Aquiline Technology Growth (ATG), RTP Global and Sequoia India, along with Korea and Japan-based investors. Existing investors Prime Venture Partners and MegaDelta have also participated in this round. Debt capital has been secured from leading players like Vivriti Capital, Credit Saison, and others in the form of co-lending and credit lines.

What are your immediate and long term milestones like?

Our mission has been to provide credit to the growing middle-income groups, in the most flexible, convenient and affordable manner, with money being available to the customer ‘on tap’. MoneyTap has been on a 4x growth trajectory and in just four years of operations, created a total loan book of ₹1,000 crores last year and has achieved a disbursal run rate of ₹2,500 crore a year.

With our recent Series B funding, we plan to scale our business, innovate with data-backed lending models and continue to hire aggressively. We will also use the funds to expand our credit offerings via our own NBFC. We aim to create our loan book to ₹5,000 crores in the next 12-18 months and expand geographical footprints from 60 to 200 Indian cities.

With our alternate data and lending models, we hope to reach new segments of consumers. We plan to expand the role of our tech and data teams to combine UI & AI – this will lead to custom credit solutions for diverse customer demographics. Our vision is the financial inclusion of underserved segments in India. With the new NBFC license, we aim to scale the business further and deepen existing Bank/NBFC partnerships through a strong focus on tech innovation, inclusive growth and hybrid lending strategies.

Lastly, any words of advice for the wannapreneurs?

Entrepreneurship comes with its own ups and downs – so tap into the potential of chaos to power growth. Resilience and adaptability to change – these qualities make a huge difference in any entrepreneurial journey. Have the humility to learn from mistakes, hire a team that has people smarter than yourself, learn from everyone, know the pulse of your customer and at all times, be frugal with spending. Building a rockstar team that understands and shares your vision is the game-changer for any venture – people keep the business going, even in difficult times.