The fintech platform uses technology, analytics tools and an easy documentation process to provide loans to customers in less than 48 hours.
At a Glance
Founders: Manoj Sharma and Neha Manoj Sharma
Year it was founded: 2010
Where it is based: Pune
The problem it solves: The platform allows users to get loans online
Funding raised: Undisclosed angel funding
India’s lending market is on the growth track. A recent report from the Boston Consulting Group (BCG) predicts the entire market will become a $1 trillion opportunity in the next five years, with a greater part of that opportunity existing in Tier II and Tier III cities in India.
Manoj Sharma realised this in 2010, when he was heading operations for financial house Karvy Finance in Pune, which dealt with gold, business and commercial vehicle loans. Prior to this, he worked with the NSE- and BSE-listed debt financing institution Capital First.
Banking on the opportunity the market held, Manoj started Dealsofloan, a direct sales associate (DSA) firm in 2010. A DSA is a distributor that helps a lending institution achieve targets by procuring customers.
His work at Karvy left Manoj with little time to concentrate on his business.
His wife, Neha, stepped in as the co-founder to run the business. It took Manoj nearly four years to leave his job and take up the project full time.
Manoj defines Dealsofloan as a digital lending platform that aims to provide loans to customers in less than 48 hours. However, what is interesting is that the startup actively caters to DSAs as well as customers.
“The majority of business done by certain financial institutions has been provided by DSAs. Those that have a good repo are treated well by the banks, and are provided a code of conduct, which freshers or intermediate-level players aren’t provided with. Also, freshers and freelancers either don't get their payouts on time, or the payout received is too less,” explains Manoj.
Hence, apart from direct customers, Manoj decided to focus on DSAs to expand the business opportunity.
Building the technology
Manoj realised he needed to build the technology platform to scale up the business. He says,
“I thought of scaling up the business in other states and help people across the country. But in today's tech-savvy world, it is difficult to survive in the market without technology. So, I was in search of a person who could help me in the technology domain.”
It was then that Manoj met Vikas Wani, the son of one of his customers.
“Vikas is a web developer who used to work as a freelancer. His client base was in western countries, and he had an excellent grip over technology. When I asked him to be my business partner and explained the product and its opportunities, he was very much interested,” he adds.
Vikas started building the web and mobile applications for Dealsofloan. But, soon, the company started facing a financial crunch, and at this moment, the founders got help from Dr Sham Chobe, who later became one of the board of directors.
How does it work?
Dealsofloan lets the customer directly visit its website and apply for a loan. They can also file their request on the company’s Android application.
Once a customer fills in the minimum details, the startup contacts them for more information. The company’s CRM software calculates the eligibility of the customer for a loan. Depending on the eligibility, the system suggests the bank from where the customer can get their loan sanctioned.
Dealsofloan also collects the required documents from the customer and applies for a loan. Once the loan is sanctioned, the customer has to sign an agreement, after which the loan gets disbursed.
The startup works with HDFC Bank as a corporate digital partner. Further, it has close to 10 finance corporations, including Capital First, that have integrated their systems with the CRM systems to provide loans.
Today, Dealsofloan disburses credit for personal loans, home loans, business loans, as well as loans against property. It is also tapping a new segment of medical professionals, giving them business loans for setting up new clinics, clinical equipment, and renovation.
The interest rate for loans to doctors starts at 10.99 percent, with a tenure of up to five years. The average loan amount for this segment is between Rs 2 lakh and Rs 1 crore.
The average rate of interest for personal loans is between 10.99 percent and 18 percent, with amounts varying from Rs 1 lakh to Rs 15 lakh. While business loans are placed between 15 percent and 28 percent of interest, it gives close to Rs 1 lakh to Rs 20 lakh in financing.
Dealsofloan serves a demographic of salaried individuals with two years of employment history, and a minimum income of Rs 15,000 per month.
The startup also provides its CRM software to freelance sale associates.
“Any DSA who is interested in doing business with us can sign up for our system, and once their details are provided, our marketing executives verify them. Dealsofloan then provides DSA codes and CRM software for business. All the data is tracked through our CRM software, and the DSA is directly connected to the banks to ensure transparency is maintained on both ends.”
If a lead comes for a DSA outside his area of business, the lead can be entered into the system, which gets automatically forwarded to the DSAs serving that particular region.
At present, the startup has its operations in Pune, and is looking to spread to 40 cities across India. Since inception, the company has helped around 20,000 DSAs do business with banks and has served around one lakh customers across India.
Dealsofloan has also processed more than 10,000 transactions on its platform so far, with an average ticket size of Rs 3 lakh. The startup also claims to have received close to Rs 2.5 crore in angel funding from a Pune-based IT company, which is already running Dealsofloan’s software.
The lending industry
The lending sector has been garnering a lot of investor interest over the last year.
SME lending platform LendingKart, in January this year, announced the closing of their $87-million Series-C round. Digital lender Capital Float has also raised $22 million in equity funding from Amazon Inc. this year, taking its total Series-C round to $67 million.
For consumer-lending startups, the short-loan segment has been getting investor attention, with the likes of Mumbai-based PaySense and EarlySalary raising funds this year.
Currently, Dealsofloan competes with digital lending marketplaces like Bankbazaar and Namaste Credit.
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.