How This Startup Uses ML to Provide Quick Credit
Emerging technologies are having a huge impact on financial services by helping them meet growing customer expectations through convenience and accessibility. The adoption of technologies such as artificial intelligence and cloud computing has positively influenced nearly every component of the supply chain across the financial product mix: payments, loans, savings, and insurance.
To understand how lending companies are using technology to open their clients’ line of credit, Analytics India Magazine interviewed Jitin Bhasin, Managing Director of RupeeRedee and FincFriends, for our weekly Deep Dive column.
Founded in September 2018, RupeeRedee is a digital platform to borrow money for short-term needs with just one click. It helps the loan seeker to get instant credits for his unexpected financial expenses. The idea is to serve the massive population of India with hassle-free credits.
“NBFCs in the background to facilitate short-term personal loans associated with PhyGital, POS, LaaS and Brokerage services to various customer segments including salaried, self-employed and first-time borrowers,” says Bhasin. RupeeRedee has deployed various forms of underwriting including alternative data sources and is not limited to underwriting based on credit score alone,” he added.
The company taps into the vast open market of India, where the ratio of household debt to GDP is as low as 11%, which is among the lowest of emerging economies such as Russia, China and Brazil. In just one year, RupeeRedee now facilitates tens of thousands of loans every month with the integration of the latest technologies. Their website and mobile app average 1.5 million visitors from 25 cities.
RupeeRedee Rise’s Secret Sauce
“RupeeRedee is a fully automated customer journey where customers can get instant loan disbursements. This is possible thanks to our deep technology integrations such as OCR-based document verification, scoring and alternative credit underwriting, instant fraud checks and offline digital KYC,” says Bhasin.
For rapid scaling and service delivery, the company uses microservices architecture, a technique that structures an application as a collection of loosely coupled services. Additionally, they also use technologies such as PHP, Angular, .NET, MySQL, Kotlin, and Redis.
While speeding up the application approval and delivery processes carries many risks, the company does not ignore the risk of potential misuse. Therefore, they leverage machine learning techniques for fraud detection, risk prediction, and more. However, the use of technology is not limited to security. Machine learning is also actively used to innovate in order to stay competitive and achieve customer satisfaction.
For example, RupeeRedee has formed several models for regulation and non-regulation. While the former is for calculating Probability of Default (PD) and Loss Given Default (LGD), the latter helps detect fraud and pre-approve customers.
To maximize the accuracy of their model, RupeeRedee uses an extensive list of demographic information along with behavioral data. “We are going the extra mile to ensure that our model continues to deliver the best results in this volatile market. As there are rapid changes in the financial landscape, we identify emerging challenges and reform the ML model to improve its dexterity,” says Bhasin.
Unique value proposition
Unlike other lending companies that are limited to serving customers with strong credit histories, RupeeRedee offers a suite of loan products for everyone, including salaried, self-employed, and new borrowers. In addition to this, Bhasin also revealed that the company is developing a plan to offer a dynamic platform to connect customers with lenders.
In addition to offering superior products and meeting the needs of various customers, RupeeRedee is focused on providing better customer experience through transparent product structure and intuitive credit redemption process.
What awaits us
The company is committed to separating customers largely overlooked by large financial institutions. Thus, RupeeRedee creates a “product ladder” that will help customers move up the credit curve. “This will allow us to offer financial products at different price points based on profiles and histories,” says Bhasin.
Scaling is essential for businesses to achieve business growth, therefore, the company is developing relationships with lending institutions and distribution partners (both digital and point-of-sale-based) to further expand the offer for mutual benefits.