[The Turning Point] Here’s how CASHe built an AI-based credit lending platform

The Turning Point is a series of short articles that focusses on the moment when an entrepreneur hit upon their winning idea. This week, we feature Mumbai-based AI-driven credit-led wellness platform CASHe that makes lending simpler, faster, and safer for the social generation.
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While attending a conference around 2015, entrepreneur V Raman Kumar was impressed with the workings of SoFi, a San Francisco-based personal finance company and online bank. SoFi was providing financial products, including student and auto loan refinancing, mortgages, personal loans, etc. It was also a lender to top ten percentile of IVY league schools based on their employability.

Inspired by SoFi’s business model, Raman wanted to build a similar business in India. However, he realised there was a need for credit, especially for the unserved younger generation, in the Indian market. This made him step up and create a solution for the problem.

In 2016, he founded CASHe, an AI-driven financial lending platform that provides fast, flexible, unsecured personal loans to young salaried millennials across India. 

Building the product

Leveraging his technology background, Raman and his team have built a predictive algorithm, which can assess with optimum precision as to whether the potential borrower would repay the loan on time, which is backed with the historic data of a reasonably uniform cohort of population--the millennials..

By the end of 2016, the team built a Social Behaviour Centre Algorithm, which was patented by TSLC, its Singapore-based holding company. Subsequently, they built a Goodness Measure Algorithm, and combined this with Social Behaviour Centre, and thus came up with their USP - Social Loan Quotient (SLQ) algorithm.

“This is our secret sauce. If our business has grown the way it is grown, it is because of SLQ,” says Raman.

He adds, CASHe’s purpose was to provide India’s urban working millennials with a path to better financial health with the aid of technology through their smartphones.

The digital lending startup has also developed an automated credit lending system with an AI-based algorithm to assess the risk of a borrower based on the user’s social and mobile data footprints.

What it offers?

Initially, CASHe introduced short-term lending, offering 15 to 30 days loan products to about 50,000 customers, which had a loan value of up to Rs 10,000.

Now, the company offers 90 day, 120, and 360 day loan products. It also has a credit line facility, which provides customers with funds based on their eligibility, and a buy now, pay later loan option.

It charges an interest rate of 1.5 to 2.5 percent on a monthly basis, depending on the loan and credits taken by the customers.

The startup claims to be recording a 10 percent month-on-month growth in revenue, and turned profitable in the third quarter of 2018.

Gaining traction 

CASHe was the first fintech lender to debut on Google Pay, offering short-term loans to Google Pay customers.

According to Raman, the company adds 15,000 to 18,000 customers every day, of which 1,800 -2,000 loans are being issued daily .

It has an active customer base of four lakh, with 1.3 million monthly active customers, and 21 million app downloads, of which half of those have availed CASHe’s services.

According to the company, it has disbursed loan values close to Rs 4,000 crore, out of which 70 percent are repeat customers and over 1.1 million loans have been disbursed.

In January 2022, CASHe raised Rs 140 crore from TSLC, bringing its total balance sheet size to over Rs 800 crore. Of this, Rs 500 crore was raised via debt from private banks and NBFCs.

Earlier this month, CASHe acquired Gurugram-based Sqrrl, and said it plans to foray into the wealth management space.

During the announcement Raman Kumar said, “The acquisition of Sqrrl is an important milestone for CASHe’s vision 3.0 roadmap as it sets the stage for the next phase of our growth through our foray into the WealthTech space.”

What next?

“We aim to be a complete wellness platform and are looking to apply for a digital banking licence," says Raman. "Until then, we are ready to empower any partner bank that wants to go truly digital. We will take them into the digital format,” he adds.

The company plans to partner with a bank to serve their customers with digital banking facilities this year. It also aims to become a digital bank after it applies for a licence and gets approved.

Right now, CASHe works with an NBFC licence, and is audited by the RBI.

Edited by Megha Reddy

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