BENGALURU: College students are well aware of the dread that fills their heart and wallets as the month draws to an end. Sudden expenses become towering problems for them and emergency funds are the need of the hour. Tapping into this market is StuCred, a Chennai-based start-up focused on providing financial support for college students. Present in over 93 colleges across India, the app became operational seven months ago in October 2018. Headed by siblings Henna Jain Tatia and Jaijash Tatia, the start-up offers loans in multiples of 500, starting at Rs 2,500 and going up to Rs 30,000 for a period of 30 days.
“When I was studying in the UK, my bank had an overdraw facility of around £15. While this was not a lot of money, it really helped tide me over, especially in the last week of the month when we are usually short of funds. When we came back it became alarmingly clear that Indian students also required such facilities,” said 24-year-old Henna.
A user needs to only download the app, upload certain Know Your Customer documents, college forms and a video selfie for authentication, before being eligible to immediately draw money in real-time. “It was really important for us to work in real-time because money is usually an urgent need, and the regular banking services may take some time. The money is directly deposited into your bank account,” explained Henna, adding that they also have a staff of 25 people including customer care, marketing, tech and graphic designers working in-house to ensure all services are provided in the shortest amount of time possible.
This financial flexibility of drawing in multiples of 500 is very important for the financial inclusion of college students, said Jaijash. “A lot of people think that the word ‘loan’ is a dirty word. However, that’s far from the case. Regular loan repayments help build your credit score, and a strong credit score comes in useful when you need it later. This also helps students build their credit score for the future, especially with visa offices looking at credit scores for higher education,” said the 26-year-old. To further support their userbase, the app does not charge interest, rather an operation fee based on the amount drawn.
Their 24/7 customer care facility is open to help students access the money they want as soon as the need arises for their over 3,700 users. Most funds are used either for recreational purposes, paying off exam or other college fees, or personal use like transportation. Henna explained that they have seen that their services are particularly useful for engineering, arts and architecture students, who need the cash for college-related supplies.
“One very funny incident was when we got a request from a 17-year-old to use our app. We rejected him because he was under 18 years old, but then a few months later, we got another request from the same person at 5am. Turns out it was his 18th birthday, and he signed up saying that he was finally eligible,” said Henna. Usership is at an all-time high during evenings and nights, with it picking up at noon after college hours, she said.
Their young user base, while being a large market to tap into, also acts as a challenge in certain areas. “We have to maintain the same wavelength with our target audience. We need to understand their preferences with regard to language so that we can stay connected to them,” said Henna. The start-up hopes to launch an alumni facility soon, which offers larger drawing amounts.
Facts and figures
● StuCred is operational in 93 colleges pan-India, with a user base of around 3,700
● The app boasts a 24/7
customer care facility and charges no interest, only an operational fee
● StuCred is a part of Kreon Financial Services, an open credit and financial services platform
● It offers loans in multiples of 500, starting at `2,500 and going up to `30,000 for a period of 30 days