Chinese tech giant Xiaomi on Tuesday formally introduced its digital lending solution in India — Mi Credit. The solution promises to disburse loans up to Rs 1 lakh within five to ten minutes. Mi Credit has been running in India in a pilot format, and has already disbursed loans of over Rs 28 crore in November 2019.
At present, the service can be availed in more than 10 states spanning across 1,500 pin codes. Xiaomi aims to expand its availability to 100 per cent of the pin codes by the end of FY2019. Mi Credit is Xiaomi’s second Mi Finance launched in India after Mi Pay.
“In India, the lending industry is on an explosive trajectory. As per a recent report from CIBIL, there are over Rs 4 lakh crore worth of personal loans outstanding from nearly 1.9 crore customers, with each user accounting to an almost Rs 2 lakh of outstanding amount,” said Manu Jain, VP, Xiaomi and MD, Xiaomi India.Xiaomi in its study found that majority of customers avail credit for medical emergencies followed by shopping, wedding, travel and education purposes.
To avail loan, first time users can complete the digital application form within five minutes, and repeat customers can avail a loan with one click disbursement.Once the loan is approved within minutes, the consumer has the option to choose the amount and the tenure of the loan. For the maximum limit, which is Rs 1 lakh, a consumer has the option to back the amount in three to 12 month. Interest rates on Mi Credit start at 1.35 per cent per month.
Xiaomi claims that Mi Credit will offer an easy application process and paperless KYC.Xiaomi has joined hands with Aditya Birla Finance Ltd, Money View, EarlySalary, Zestmoney, and CreditVidya among other Fintech brands and NBFCs as lending partners for Mi Credit service.Jain said one of the advantages of the service is that the loan can be credited in accounts across all major banks in India, adding “Also, all data we will be collecting would be stored on Mi Servers in India.
“Xiaomi’s Mi Finance business started four years ago in China, with an aim to provide Fintech innovation for everyone … We see a huge opportunity for consumer lending in India with estimations reaching up to $1 trillion dollars in digital lending by 2023, as per a report from BCG. This makes us believe that our Mi Finance business can truly revolutionise the industry,” said Hong Feng, co-founder and senior VP, Xiaomi Corporation.