Bridging the gap between consumers and financial institutions with tech-enabled credit marketplace

Rubique - The ‘Uber’ of financial services

The fintech space in India is going through an exciting phase today. According to NASSCOM, the Indian fintech market is expected to grow at a CAGR of 22 percent for the next five years. Findings from a KPMG report indicate that the transaction value for the Indian fintech sector was estimated to be approximately $33 billion in 2016 and is likely to reach $73 billion by 2020.

But in 2014, when Rubique started its journey, the fintech scene in lending was nascent and for the most part unheard of. Four years later, the fintech company that facilitates tech-enabled financing solutions is going strong, growing steadily with over Rs 150 crore of disbursement and 5,000 credit cards set up every month, and a monthly revenue of Rs 3 crore.

Since its inception, the company has acquired a customer base of over 1,00,000, disbursed more than Rs 2500 crore worth of loans and set up over 75,000 credit cards, driving a revenue of Rs 43 crore. Rubique has been able to maintain unit economics positive on a transactional level while growing consistently.

How the prevalent and unaddressed industry gaps led the founder to start Rubique

Rubique was founded by Manav Jeet, who is also its MD & CEO. While working in the banking sector for over two and a half decades, Manav Jeet saw that the existing lending marketplace in India was highly inefficient, uncertain, and time consuming for customers as well as financial institutions. Traditional formal credit channels in India were (and continue to be) driven by constraints such as elaborate procedures and compliance checks—which are mostly rigid and lack accuracy. The outcome is poor credit growth and delayed credit disbursement, which leaves credit-seekers in a lurch.

In addition, owing to the varied risk appetite of financial institutions, it was challenging for them to get the right customers, leading to high rejection rates, as high as 60 to 70 percent.

Manav believed that for every borrower, there is a lender willing to lend but because of the traditional market practices, they both are unable to discover each other. That’s why he founded Rubique in 2014.

Embedding technology thinking into financial services

According to Manav, Rubique’s biggest differentiator is the "technology thinking of financial services,” and using technology and automation to address challenges in the financial services. In fact, he adds that Rubique was among the early adopters of Artificial Intelligence (AI) in fintech.

The startup’s Online Plus offering leverages its rich customer data and bank credit policies to provide a customised list of financial products to each consumer based on the individual’s needs and profile, through its proprietary AI-based matchmaking and ranking algorithm. This leads to higher approval rates, better customer satisfaction and improved sourcing for Rubique’s financial partners. This, coupled with real-time status tracking, plugs the gap in transparency in the overall process and keeps the customer informed about the progress of the application. Thus, in combination, Rubique offers a win-win ecosystem by solving for customer experience on the demand side and the issue of quality for the financial institutions on the supply side. It is evident in the approval ratios Rubique showcases – 90 percent for retail and 66 percent for SMEs.

As an exchange platform, Rubique aggregates all the available products from financial institutions, so that every consumer can easily search for best deal as per their financing requirement. And as a maker platform, Rubique has developed technology solutions and mobile apps for its stakeholders such as – SPOT (Single Point Of Truth) for the associates empowering them to become financial entrepreneurs, TAB (Tech Assisted Business) solutions for facilitating SME loans, white label solutions for financial institutions for better underwriting decisions etc. Rubique doubles up as a financial matchmaking platform, and with its blended phygital approach it addresses the need of the entire ecosystem.

“From a technology perspective, we plan to work on creating innovative and customised solutions to align with the needs of our stakeholders. Our solutions such as the white label transactional platform, new scoring models like Rubique MAGIC score etc are a step in this direction. Today, data is akin to a gold mine. We have reached a milestone of a 1,00,000 customer base, and with it we would now like to invest in data science to generate valuable insights to develop innovative solutions and further enhance the customer experience, ”says Manav.

A secure and scalable solution

SPOT is a cloud-based multi-tenant solution that acts as a one-stop solution for all stakeholders – customers, business associates, internal employees and even financial institutions. Its configurable workflow engine allows seamless origination, assessment and fulfilment for products like loans, credit cards and insurance. The SPOT platform is integrated with paperless-focused features like blockchain based e-KYC, bank statement analysis, credit bureau check, credit memo generation and MCA integration etc. These features further allow real time decision-making on the application.

“With the world constantly innovating we have to ensure that we are one step ahead. Hence the SPOT platform has been designed to reduce cost and effort without compromising on the delivery and security of data. The platform has leveraged distributed systems, cloud offerings, Multi-AZ replications and serverless architectures to make our entire solution horizontally scalable and available. The platform is also fluid and can be constantly evolved to ensure we remain the market leaders in our space.” explains Suraj Agarwal, CTO, Rubique.

Enabling efficient disbursement of credit to SMEs

Having served in several strategic leadership positions in prestigious corporates like HDFC Bank, Citicorp Finance, SBI Mutual Fund, Reliance Capital and Yes Bank, Manav has played an instrumental role in launching various financial products during his career. He has handled various types of products ranging from micro-finance and retail & SME loans to unsecured business. Manav cites the PwC Fintech Trends Report India 2017, which highlights the disproportionate supply of credit, in spite of contributing to 37 percent of India’s GDP, and says, “SMEs are considered suboptimal borrowers due to their small size, information asymmetries and cost of credit delivery. India has more than 50 million SMEs with an unmet debt demand of USD 380 billion approximately.” He says one of the key reasons why SMEs find it difficult to find credit is because they do not always understand the different kinds of credit products that are available in the market, and the ones that fit their requirement. “This leads to high discovery timelines. Often because of improper or insufficient paperwork, history evaluation and incorrect credit profile, the loan applications get rejected.”

It was to help bridge these gaps that Rubique launched the one-stop transaction platform called TAB solutions, which handles the lead from origination till disbursement for SMEs. To enable correct product fit recommendation, the solution works on a need-based assessment analysis of credit requirement. In addition, TAB offers a wide product portfolio and gives an overview of low to high risk capital requirements. The platform offers solutions across five broad level product categories of two secured products – Loan Against Property, MEL (Medical Equipment Leasing), three unsecured products – micro business loans (less than Rs 5 lakh), unsecured business loans and commercial vehicle finance. The platform also incorporates technology propositions like eligibility check through a matchmaking algorithm, bank statement analysis, MCA integration, real time credit bureau check and real-time status tracking by integrating with financial institutions’ systems.

The TAB solution comes with advanced technology features like IRIS scan for Aadhaar authentication, and generation of credit assessment memo (CAM) along with deviations enabling the credit underwriter to take quick decisions and further reduce the processing time. The advanced technologies used by Rubique analyse multiple data points to assess the creditworthiness of the customers and determining the offers they are eligible for, thereby removing the manual efforts in the loan processing system.

Gunning for bigger goals

With a team size of 100 and growing, Rubique is present in seven cities in India (Mumbai, Delhi, Bangalore, Kolkata, Pune, Hyderabad, Chennai and Jaipur). Supported by 5,000+ business associates on ground, Rubique caters to customers from across the country. To back its business associate network, Rubique recently launched the Rubique prepaid card which will facilitate payouts, working capital support, and rewards and recognition benefits. The prepaid card powered by Mastercard will be linked to the Rubique e-wallet enabling users to transact just as they do with any other debit card.

So far, Rubique has focused on driving business in top Indian cities, but FY19 will see the team expanding its product offering to cater to customers in Tier 2 and 3 cities. Manav says, “Our expansion plan will be augmented by engaging with government entities to provide technology-based financial solutions to upcoming markets in Tier 2 and 3 cities, thereby helping us gain a strong footing in those regions.”

For the first three years, two big focus areas for Rubique were strengthening its technology propositions and driving its B2B partnerships and business. “FY19 will see Rubique going aggressively after the B2C market. Our expansion plan will take on a hub and spoke model to increase our reach to 50 cities. With these plans in place, we aim to break even in 2019,” he says.

Manav believes that recent government initiatives like GST, UPI, Jan Dhan Yojana, and Aadhaar, have played a supportive role in opening up the financial ecosystem for digital initiatives. “These initiatives have provided a good underpinning for fintech companies to permeate ‘last mile’ touchpoints and boost financial inclusion in the country. As a fintech business, all these developments have definitely worked in our favour. We have partnered with leading financial players and have seen a lot more integrations going live on our platform. Working with some government entities like National Small Industries Corporation (NSIC), Fintech Valley – an initiative by the Vizag government, allows us to further tap growth opportunities.”

As a long-term goal, Rubique envisions becoming the largest financial marketplace in India with a vision of fulfilling all financial aspirations in the customer’s life cycle in the simplest, shortest and speediest way. Rubique will continue to develop superior technology products for the ecosystem players thereby aiming to bridge the credit gap.

“We have managed to successfully stand out in the fintech space as an innovator par excellence and one of the genuine success stories of the domain through our unique model & approach creating “Uber” of financial services working with entire ecosystem and connecting the missing dots.,” is how Manav sums up his company.