Digital finance is fast growing, and it is one area where fintechs have shown promise and even started gaining currency. There are quite a number of these fintechs, which have developed solutions in areas such as microfinance, digital payments, online lending, remittances and in niche areas like ‘buy now-pay-later’ and unsecured loans for those not covered by the conventional organizations.
One such new-age enterprise is LenDenClub, which is a P2P lending platform. According to Bhavin Patel, co-founder & CEO, borrowing is like bungee jumping. He tells Banking Frontiers in an interaction: “Imagine that you are going for bungee jumping. You are afraid what will happen when you take the next step. The same thing happens when you think of getting a loan. However, at LenDenClub, we concentrated on making processes simpler, but effective. This resulted in a loan application getting considered in not more than 3-4 minutes and that too from one’s mobile device. Once we get the application, we approve the loan within time ranging from minutes to hours in comparison to days taken by banks. We do more stringent and logical verification of the borrower. On the basis of that we generate our own credit score, ie LenDenClub score. This score helps lenders in deciding which loan s/he should invest in depending on his/her risk-taking capability. Investors/lenders come on the platform to get access to the pool of verified borrowers. Lenders start investment with just 3 clicks, which is easier than any investment in instruments like equity, MF or insurance.”
He says P2P lending in India is the fastest emerging financial sector right now. The sector is expected to grow much faster than overall financial services sector in the country and the concept is getting wider recognition across metro, tier 1 & tier 2 cities. Says he: “P2P lending is a new age investment asset class attracting investors from Generation X to Millennial. I am expecting P2P loans to play a significant role in agri credit and MSME credit as well.”
