WATCH: How fintech startup Finnable wants to make credit available to SME employees in one minute
Founded by Nitin Gupta, Viraj Tyagi, and Amit Arora in 2016, Bengaluru-based fintech startup Finnable wants to make consumer and personal loans hassle and paperwork-free.
Furniture, appliances, vacations…our “wants” keep increasing with every paycheque. But often, it’s not possible to have it all in a salary. Enter Bengaluru-based fintech startup Finnable, which aims to make personal and consumer loans available in less than one minute.
Launched in 2016, by Nitin Gupta, Viraj Tyagi, and Amit Arora (who joined them in 2019), the firm, which has an NBFC licence, wants to make loans hassle and paperwork-free.
Over the last three years, the Finnable app has had 300,000 downloads and served 30,000 repeat customers a month. The customer base, believe the founders, is still growing.
How the Finnable story started
In the late nineties and early 2000s, three men met while working at Standard Chartered in Bengaluru. They befriended each other and often talked about entrepreneurship.
Nitin and Viraj started Net Positive Analytics (NPA), an analytics company, in 2007, for the banking industry. The analytics and business intelligence solution targeted large banks across the globe. The duo built enterprise products that were deployed in banks in India and the Middle East. They scaled up the company and had clients in the US, Africa, UAE, and Australia with multiple delivery centres across the globe.
In November 2014, NPA was acquired by Equifax, an Atlanta-based global provider of bureau and data services.
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Understanding the risk profile
The sale gave Nitin and Viraj a year off to think about “what next”. In 2016, they reconnected with Amit who was keen to step on to the entrepreneurial path. The trio realised that Indians need to be banked, and knew they could use their banking and analytics experience to underwrite loans.
They applied for an NBFC licence in the same year and started work on Finnable. For this, they gathered data from telcos on user scores and began to build algorithms that looked at job and payment stability of potential customers.
“In the lending business, you need to have an understanding of risk profile. We have, over the last two years, understood credit profiles and risk in unsecured lending. People take money from us for education and marriage,” Nitin says.
According to Finnable, there are 80,000 companies with revenue of Rs 5 crore to Rs 10 crore and each of them employs 25 people on an average.
“Banks don’t provide credit to employees who work in companies with less than 250 employees. Our mission is to go to these companies and help their employees find credit,” Nitin says.
The fintech startup at present provides personal loans up to Rs 10 lakh and consumer loans up to Rs 1.5 lakh for anyone with a take-home salary of Rs 15,000 per month.
Nitin feels that just a digital presence is not the solution to India’s unbanked problem. “You need a combination of assisted and digital experiences. For example, we will have collection centres set up across the country or else the digital lending business will not scaleup,” he adds.
What’s in the future for Finnable?
A white paper by ACI Worldwide along with AGS Transact Technologies (AGSTTL) says digital transactions in India can hit $1 trillion annually by 2025.
The 30-member team operates in Bangalore and Chennai at present. It aims to cover six metros in the next 12 months and add six more Tier I cities in 18 months.
The founders have invested close to $1 million of their own money in Finnable, which also aims to launch products like credit cards and offer credit for travel.
“Indians are aspiring to travel globally and our loan product is structured with zero interest. The borrower pays back after complying with certain conditions,” says Amit.
The company’s average loan disbursement is Rs 1 lakh, but the co-founders did not want to disclose the total loan exposure.
“We don’t plan to raise money this year, but are open to raising money in the future,” says Nitin, as the co-founders focus on their mission: making everyone financially able.
(Edited by Teja Lele Desai)