Ditching a salary in pounds to start up in India, this entrepreneur now offers small-ticket loans

One-year-old fintech startup Nira is based in Bengaluru and provides loans to people from lower income groups who normally do not easily get bank loans.

Sitting in a plush London office and trading stocks worth millions of dollars for a global financial powerhouse is an aspiration for many. And to leave it all behind to help people access small-ticket loans requires passion and commitment.

That’s how one can describe Rohit Sen. Born in the UK, Rohit has degrees from Oxford University, and the London School Economics, and has worked at financial services companies such Bank of America-Merrill Lynch, and Goldman Sachs.

“I was not the guy who said that I always wanted to be an entrepreneur, but could see the changes happening during my trips to India,” says Rohit. Every visit convinced Rohit that data and technology could be used to solve fundamental problems in a big way.

Nira founders: Nupur Gupta (left) and Rohit Sen

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Working in London, Rohit had a ring side view of the fintech industry and decided he could apply the same in India. While the idea of coming to India had a strong appeal, Rohit’s job as a stocks trader was very demanding leaving him little time to think about his own venture. “There was an enormous opportunity in India that matched my skillsets,” says Rohit. The choice before him was clear: quit and go for it, or forget it.

Decision time

Rohit’s boss told him he was “crazy” to try and start up in India, and in fact, read out to him the income he had made over the last five years.

“I was convinced about the opportunity, and told myself that if I don’t do this, I cannot live with myself,” says Rohit.

It was a big leap of faith as he landed in Bengaluru with zero contacts, and unsure where to start.

The only idea in his mind was to make credit accessible to people who are normally shunned by banks. Initial challenges, for Rohit, not his startup, were a bout of dengue and the Cauvery water riots, but the determination to start up was strong as ever.

He saw people in the lower income group, with salaries ranging between Rs 20,000 and Rs 40,000, had enormous basic commitments like education, health, and even buying essential household goods. “I discovered that a wedding is a ‘need’ in India,” remarks Rohit.

He, thus, decided on financial product that would cater to the credit needs of this group of people.

The goal

Nira, his fintech startup, was incorporated in March 2017 and went live with its products in May-June 2018. Rohit believes credit has to be disbursed in a systemic manner, and with Nira, has created a model that can give a strong sense on the credit worthiness of an individual. Based on Nira’s own parameters, it lends to borrowers with a good credit score at lower interest rates. It also lends to those who do not have a credit score and are first-time borrowers. The fintech startup has tied up with Federal Bank for loan disbursal.

In the process of building his startup, Rohit found a co-founder in Nupur Gupta, his colleague at Goldman Sachs.

“I’m the big picture guy, while she is more detail-oriented. Having a co-founder really helps as we can brainstorm together and we bring complementary skillsets to the table,” he says.

Key is discipline

The start was tough, says Rohit, as it was really all about selecting the right set of borrowers. In the frenzy of giving out loans, there is always the big problem of recovery. “This business is about discipline,” says Rohit. It took Nira three months to disburse 100 loans, but in December 2018, the startup was disbursing 100 loans a week. Typical loan sizes are Rs 20,000-25,000, while the maximum limit is Rs 1 lakh. The startup also has schemes wherein a company can register with Nira and allow its employees to avail loans from the startup at competitive rates.

Rohit says Nira ensures a tight rope walk between growth and discipline. “There is way too much focus on disbursal and not so much on collections,” he remarks.

Nira has raised one angel round of funding to the tune of $1 million. Plans are to raise more funding in the years to come for customer acquisition and risk capital.

Rohit says it will take a certain scale to break even, and build a path to profitability. Nira currently has operations in 10 cities across the country, and Rohit says the real opportunity will be in the Tier II cities. “We have to be careful about roll out as there is the question of collections and we are still figuring it out,” says Rohit.

For Rohit, it is about a long-term vision as he believes India will transform in the next 25 years and offers a big opportunity. “I feel I have something to contribute to India,” says Rohit. Though he admits that there is much stress in dealing with a startup, he has never once regretted his decision.

On the USP of Nira, given that fintech looks like a crowded space in India, Rohit says the market penetration has barely started. “We run our business based on discipline in areas such as risks, collections and maintain the fundamental things like know your customer.”

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