BENGALURU: Bengaluru-based fintech start-up MoneyTap, which was launched six months ago in 14 cities, is now expanding to 30 cities in India. MoneyTap is India’s first app-based credit line, which lends from as little as Rs 3,000 to Rs 5 lakh through a completely paperless process.
MoneyTap promises to process credit application in a matter of minutes and operates through the ZeroPaperTM technology. The app has a set-up fee of Rs 500, which is to be paid to the bank only once and consumers will have to pay interests only for the money used and not for the amount approved as credit by the bank.
“Our target is the middle-income person in the cities, making between Rs 20,000 and Rs 70,000 a month. Our goal is to include the people earning between Rs 20,000-Rs 15,000 and from there the ones earning Rs 15,000 - Rs 10,000 as well. But we cannot get into rural or agricultural lending and that’s typically because our lender will not lend there and we are not the lenders but the enablers,” says Bala Parthasarathy, CEO & Co-founder, MoneyTap.
This is a free Android app, which after download asks a set of questions to the consumer and fills in the information. It takes 5-7 minutes to evaluate the customer and the CIBIL scores are drawn out automatically once the PAN number is given. It is a completely chatbot-driven process. This evaluation has to be done only once in the lifecycle of the app.
MoneyTap has partnered with RBL Bank and is in the process of tying up with many more banks and non-banking financial companies.
Banks still have paper KYC formalities but MoneyTap has been able to eliminate this with consumers being able to complete the whole KYC process on the app. The banks are protected at the back-end with a cloud-based platform that is compliant with Aadhaar and Bank Security regulations.
Bala tells us that despite an interest rate of 15-20 per cent the default rate has been zero. “If you look at the data on microfinance, it is the rich people who are defaulting. We have enough quality people who need credit and they are mostly honest. The credit card default rate is like 3-4 per cent, microfinance default rate is 0.2 per cent in the lower segment. They have no other source of money, if they default on credit, it is cut off for them and there is no other source of money,” he says.
Loans can be repaid in equated monthly instalments of over a period of two months to three years with the limit getting automatically replenished as soon as the EMIs are paid back.