RBI’s rate cut and fintech lenders; Home salons powered with AI

Hello,

Starlink is finally coming to India! 

The Department of Telecommunications has issued a licence for the Elon Musk-owned company to roll out satellite internet services in India. Broadband from space will soon become a reality for millions of Indians who are still not adequately covered by mobile networks.

But Musk is in a soup. After a public feud with US President Donald Trump, Tesla’s shares nosedived, wiping off $150 billion in market value when Trump threatened to cut off government contracts.

One of his other companies is on a learning curve. AI startup xAI is training its AI voice assistant with conversations about unusual topics like surviving a zombie apocalypse or living on Mars. The goal is to make the AI sound more natural and less robotic.

ICYMI: This week, ‘Godfather of AI’ Yoshua Bengio launched a non-profit to build safer AI systems, and AI voice company ElevenLabs’ latest text-to-speech model can whisper, laugh, and sigh.

But innovation comes at a cost. The UN’s digital agency says that operational carbon emissions for the world’s top tech companies rose 150% between 2020 and 2023 driven by investments in AI and data centres.

In today’s newsletter, we will talk about 

• RBI’s rate cut and fintech lenders
• Home salons powered with AI
• Building a clean nutrition brand

Here’s your trivia for today: In which city was the first LGBTQ pride parade held in India?

Policy

What RBI’s rate cut means for fintech lenders

The RBI on Friday delivered a surprise 50-bps rate cut to 5.50%, throwing a lifeline to fintech lenders grappling with the sharpest slowdown in unsecured credit since the pandemic.

However, industry executives suggest that while rate cuts are welcome, more comprehensive policy measures may be needed to fully revive the sector that has seen disbursal volumes plummet to four-year lows.

Key takeaways:

• The RBI delivered a larger-than-expected repo rate cut, primarily because inflation has fallen well below its 4% target, and is projected to remain low at 3.7% for the year.
• This easing in inflation gave the RBI room to shift focus from controlling prices to supporting economic growth, especially as global uncertainties and trade challenges have created headwinds for India’s growth outlook.
• Some fintechs had already started seeing green shoots way before the rate cuts by RBI. PB Fintech said in its earnings call that while lending remains below FY24 levels, they believe they’ve passed the worst of the slowdown.

Top Funding of the Week>

Startup: Udaan

Amount: $114M

Round: Equity

Startup: Snitch

Amount: $40M

Round: Series B

Startup: Stable Money

Amount: $20M

Round: Series B

Startup

Home salons powered with AI

SalonTym was founded in July 2023 by friends Vishal Saini and Geeta Chetri under the legal entity ThinkAI Innovation Pvt Ltd. The goal was to offer accessible home salon services, with a focus on women’s employment.

Its services include make-up, hydra facials, body polishing, waxing, manicures, and pedicures—all delivered by a trained network of over 300 women service partners.

Glow up:

• SalonTym has developed a proprietary AI-driven skin analyser tool that allows users to scan their face through the app and receive hyper-personalised facial recommendations based on a database of over 1,000 skin types.
• Saini underscores that the data is collected with user consent in controlled environments and is not shared with any third parties like Meta or Google.
• The startup also uses this data to power product development. That is how its in-house skincare brand Cosbar came into being, with products like facial kits, body polish kits, and waxing kits manufactured in partnership with a Delhi-based facility.

Women entrepreneur

Building a clean nutrition brand

Sisters Veda and Sai Sudha Gogineni’s combined experiences and exposure to the startup ecosystem helped them take the plunge and launch nutrition startup Earthful in 2022. The brand offers clean, plant-based nutrition, offering 100% natural supplements.

Earthful works on a loan licensing model where R&D, quality control and supply chain management are operated in-house. It has tied up with a couple of manufacturers for job work. It works with expats in nutrition sciences, including food scientists and phytochemistry experts.

News & updates

• AI suit: OpenAI is appealing an order in a copyright case brought by the New York Times that requires it to preserve ChatGPT output data indefinitely, arguing that the order conflicts with privacy commitments it has made with users.
• Unimpressive: Broadcom’s shares fell more than 3% in early trading on Friday, after the company's third-quarter revenue forecast failed to impress investors who have been extremely bullish on chip stocks amid an artificial intelligence boom.
• Tough act: Switzerland proposed some of the toughest capital rules in the world on banking giant UBS in an effort to prevent another Credit Suisse-style meltdown, protect taxpayers and restore the country’s reputation as a haven for rich people.

In which city was the first LGBTQ pride parade held in India?

Answer: Kolkata. The Kolkata Rainbow Pride Walk was held on July 2, 1999.

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