According to Research and Markets, with less than 3% of adults using credit cards, India has some of the lowest rates of penetration in consumer credit. Under traditional channels, the cost of distribution and operation is high, which could be one of the reasons for its low penetration.
The fintech firm ZestMoney is using a “Buy Now Pay Later” option that uses existing credit scores for repeat customers and creates credit scores for first-time borrowers. With a user base of nearly 60 lakh people, the platform is looking to cross INR 100 crore revenue in FY 2021, which was at INR 72 crore in FY 2020.
According to Research and Markets, with less than 3% of adults using credit cards, India has some of the lowest rates of penetration in consumer credit. Under traditional channels, the cost of distribution and operation is high, which could be one of the reasons for its low penetration. However, technology can help bridge this gap, which is what ZestMoney aims to do. Realizing that India needs smaller ticket products in categories like insurance, credit, and mutual funds, three colleagues named Priya Sharma, Lizzie Chapman, and Ashish Anantharaman started ZestMoney back in 2015. The company helps in converting credit balance to EMI, while also dealing with referral earnings and low-cost EMIs. The services are end-to-end, with zero human interaction. To understand the creditworthiness of a customer, the company looks at their SMS data, offers its technology to over 100 NBFCs to lend to the customer.
Source: Business World
