CXOToday has engaged in an exclusive interview with Mr. Yashoraj Tyagi, CTO & CBO, CASHe.
- Please throw some light on the factors fuelling the growth of the Indian digital lending market over the course of the past two years.
The FinTech ecosystem gained immense popularity in recent years, especially after the outbreak of the pandemic. The BFSI sector, particularly, soared with digital lending services transforming loan process and disbursement methods. There have been numerous factors that have caused the growth of digital lending in India. Some of them are mentioned below.
Easier Process: The Digital infrastructure built by the fintech lending companies has made it possible for them to make the lending process much simpler. Almost everyone these days prefers to operate online rather than in person.
Introduction of e-KYC: The introduction of e-KYC has been a significant factor in the rise of digital lending. e-KYC checks help lending firms to verify the customer’s Aadhaar credentials and verify their identity among other details. This certainly helps financial institutions to quicken the loan application process thereby making lending and borrowing a better experience.
Govt. initiates: Various initiatives of the government have also fuelled the growth of digital lending in India. In the last few years, a considerable amount of money has been allocated for digital India initiatives. Initiatives such as having a Fintech ecosystem were part of that plan, which has played a vital role in transforming India into a digital economy. Further support from the government can ensure that Digital lending gains more importance.
User-Friendly Interface: Digital lenders give particular attention to the user interface of their online digital lending platform. This platform can be in the form of a mobile app, a website, or both. It is important to make the interface user-friendly or else the borrower might not find the platform attractive and may lose interest in dealing with it. New-age lenders, especially the fintech companies have the ability to make interfaces highly attractive and super easy to use.
2. How has the advent of technology helped the lending space?
Lending firms have adopted cutting-edge technologies that have helped borrowers to get almost instantaneous loan approvals and money in their bank accounts. Digital lenders today reap the benefits of AI and ML to avoid time-consuming activities and foster customer relationships. AI-based chatbots, for instance, handle a substantial amount of customer interactions that were earlier handled by humans. AI’s predictive analysis also assists digital lenders to optimize the lending process by allowing lenders to focus on customer engagement and retention. In addition, the new-age technology drives efficiency by empowering digital lenders with fraud detection at an early stage.
Data Science: Data Science also plays significant role in enhancing the digital lending service making it more consumer-centric, and secure with the help of robust verification and monitoring, thus making it convenient for both the borrower and the lender.
Robotic process automation (RPA) helps digital lending firms to quickly process loan initiation, document verification and to handle any exceptions if any. Faster processing leads to improved customer experience (CX).
Various other tech-enabled services help automate the loan processes, making it more secure and efficient. For instance, video KYC facilitates a paperless, inexpensive solution for remote customer onboarding – essential for a future where more and more customers will prefer contactless services. e-Sign can further help lenders acquire customer signatures on essential documents in a completely contactless manner through digital platforms/apps.
3. In a first, CASHe in association with IRCTC announced travel now pay later facility for train travellers. What has been the traction in the space?
Since we launched the TNPL payment method on the IRCTC Rail Connect App in October 2022, we have been receiving a positive response from consumers as it makes for an affordable and accessible option for the travelers of Indian Railways. This is India’s biggest travel now pay later embedded EMI payment journey with IRCTC of its kind. We have witnessed a spike in registrations by 25-27% month-on-month basis already. So this is a healthy sign and we are expecting this to further go up in the coming months. The flexibility of the TNPL option on the IRCTC Rail Connect app is helping consumers to act on their pent-up travel desire as people can pay back the money in three to six equal interest-free installments. We are optimistic that this emerging trend of travel loans will encourage people to step out and fulfill their travel bucket lists while providing a significant boost to the industry.
4. CASHe has transformed from digital lending to wealthtech space – what are the bouquet of products and services that CASHe offers to its customers?
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. By integrating CASHe’s millennial-focused credit-led services with the digital-first wealth and investment management offerings of Sqrrl, we aim to seamlessly fulfill the diverse credit and investment needs of the new-age Indian by offering multi-product access and next-gen financial wellness solutions. Sqrrl gauges the personalized investment needs of individuals and matches them with funds available in the industry. It is like a personal finance buddy that one can rely on to save and grow money. It is a platform with the MVP around savings and investment products powered by Mutual Funds. It offers SIP, Lumpsum, Goal-based & Round-off Investing and ELSS Funds, fixed deposits, digital gold where it offers the users to buy digital gold for as little as Re 1 and Equities ( Direct equity and F&O)
5. With this transformation, what kind of technology is being used by CASHe please help with some of the implementations the company’s ecosystem
Sqrrl adopts a consultative method to gather information about the needs and circumstances of the customer, then creates a custom plan that incorporates a variety of financial products and services. We leverage advanced analytics to use personal data and provide a more tailored service to our users. Advanced analytics, enabled by AI and ML transforms this data into insights for our customers. It also helps integrate novel and unique data sources to help our users make optimal investment decisions
6. How has been CASHe’s expansion into the wealth management business been growing?
Over 25 million additional users of CASHe can now access a digitally enabled, mobile-first, byte-sized investing platform that will help them kick-start their investment journey with as little as ₹100. We have already garnered good traction from the existing customers on our platform to explore investment opportunities to grow their investments through the various investment options made available to them through Sqrrl.
7. How can one prevent loan defaults and debt traps, what’s your take?
Getting out of a debt trap is often difficult, especially when you have defaulted on a loan. A loan default occurs when a borrower is unable to repay the EMI amount with interest to the financial institution as per the loan agreement. Commercial loans are considered defaulted if the borrower has made zero payments of interest or principal within 90 days, or is 90 days past due. One of the best ways to get out of a debt trap would be for the borrower to look for a new, low-cost personal loan and pay off his current pending debts. By consolidating the debt, the borrower is combining multiple debts into a single debt. It allows them to opt for a favourable payoff term with a lower rate of interest and EMIs. It is also important to create a budget and stick with it. The defaulter should avoid unnecessary expenses, be they big or small until he/she is not in a financially comfortable position This includes reducing the usage of credit cards too. Use credit cards wisely because you may end up incurring high-interest rates and penalties for not paying them on time
