The future of lending is definitely digital: Manish Bhatia, Lendingkart

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The third wave of Omicron is nearly over and life is returning to normal. After two years of embracing the digital lifestyle, people are craving traditional or offline experiences again. While this is undoubtedly a positive development, one can’t help but wonder if it will impact businesses that offer digital services. Manish Bhatia, President – ​​Tech, Analytics & Capabilities at Lendingkart, however, says digitization is here to stay regardless of the pandemic situation. Read the full interview here

QD: An increase in digitization has been seen over the past two years due to COVID. How has this trend worked for Lendingkart?

Manish Bhatia: The past two years have seen many changes in operating modes. The world has moved from traditional ways of working to innovative digital means of survival. This is true across all industries – from online food delivery, brands have adapted 10-minute grocery deliveries, to real-life kitchens, we’ve seen an increase in cloud kitchens and brick-and-mortar lending branches, businesses have moved to digital lending.

One of them being Lendingkart. The future of lending is digital and with that as our focus, over the last 2 years we have truly evolved as a company when it comes to digital lending. We have disbursed over a billion dollars in loans across the country without any physical branch! We are now moving towards transforming Lendingkart into a lending marketplace. Our full-service lending platform Lendingkart 2gthr, will connect different financial institutions – NBFC, DSA, PSU, lenders, originators, borrowers with each other and provide access to robust data-driven platforms in the loan disbursement process. We have approximately 1200 DSAs and 101 distribution partners – Amazon India, Punjab National Bank, Canara Bank, Bank of Maharashtra among others – which span our entire cycle from origin to sourcing. Our vision is to become THE DESTINATION for all credit and financial needs of our over $65 million MSME clients in India.

We already have the building blocks in the form of platforms like Lendingkart Xlr8 which is used by thousands of offline and online O2O agents spread across India to provide assisted lending experience, Lendingkart Cred8 – a proprietary underwriting engine to rate businesses based on cash flow rather than credit rating alone and Lendingkart Collection10 – a full service as a service collection and Lendingkart 2gthr – used by several co-lending partners like PNB, IDFC First Bank and Canara Bank, which I explained above. These platforms have enabled us to scale and evaluate over 11 Lac MSME applications resulting in over 250,000 loans worth over 11 L+ crore.

To improve our digital lending experience, we integrated Account Aggregator (we were actually an early adopter). We now have 7 LIVE banks in coverage and our goal is to achieve 60%-70% Account Aggregator (AA) adoption. We clearly saw a 4-5% improvement in converting AA-compliant apps.

We understand that the world is mobile and with internet penetration reaching the sky, it made sense that we worked towards an app-centric approach and increased vernacular coverage on our Lendingkart app which is available on Google Play Store.

QD: When we talk about digital lending, there are several players in the market. What is the competitive advantage that Lendingkart has to offer?

Manish Bhatia: At Lendingkart, our vision is to simplify and standardize financing for MSMEs. As I mentioned above, our goal is to make access to working capital a reality for over 65 million MSMEs in the country. Today, our technology stack and our platforms (2gthr, Cred8, Xlr8, Collec10, Account Aggregator among others) have enabled a client to apply for a loan in less than 5 minutes. We call it a Zero-Touch self-service journey. This has seen a growing trend in terms of user adoption which is really fantastic.

QD: Everyone yearns for normalcy again and people look forward to traditional experiences. Will this impact digital lending?

Manish Bhatia: The reality today is that the world is moving towards digitization or rather has done so to some extent and there is no turning back. The world is compelled to accelerate and deliver digital solutions to

Questions. We are waiting for innovations that will bring us food via drones rather than humans and I am sure there are many things that will surprise us with the constant need for industries to innovate and stay ahead of the path to digital. I will repeat – The future of lending is definitely digital! Government rules mandate digital registration of MSMEs, loan application process in banks is adopting digital methods, even KYC verification is now digital.

QD: What role does data play in digital lending? How does Lendingkart use data and technology to put loans at your fingertips?

Manish Bhatia: At its core, we’re a data-driven technology company. This has helped us reach and personalize our customers’ digital experiences. Over the past 7 years, we have built a vast MSME data warehouse of over 3.5 billion data points which is also not operated by other financial institutions.

Using our comprehensive AI and ML Lendingkart Cred8 underwriting platform, we have rated over 1.1 million apps. This helps us assess NTC clients and thin files that may have been frowned upon by other financial institutions. Data is at the heart of our technology platforms.