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| Edited By: Praveena Sharma |Source: DNA |Updated: Mar 21, 2018, 05:16 AM IST
We are focused on small and medium enterprises lending. Our platform connects the merchants registered with us with our lending partners including banks and non-banking finance companies (NBFCs) like Mahindra Finance, Bajaj FinServ and others.
Through our platform, small retailers and businessmen can raise unsecured loans with least documents as we provide comfort to the lenders because of the sales transactions of the merchants. What we have found is that our tie-up with banks and NBFCs reduces the documentation need and increases eligibility for loans for SMEs. When the lenders are going through us, they get the comfort of repayment of the loan. This is the reason they are providing competitive interest rates, which range between 12% and 18%, which is comparatively nominal to others. Average loan size on our platform is Rs 26 lakh and average interest rate is 14%. Of course, it is all unsecured and based on transactions on our portal. The lenders ask for only KYC (know your consumer), bank statement and Cibil (Credit Information Bureau India Limited) score. On our part, we provide details of turnover of these SMEs registered with us. Based on their financial performance on our platform, we also provide some kind of rating to the businessmen registered with us.
Snapdeal and others have only online presence. We have both online and offline SMEs with us. We have entire sales force of more than 1000 people, who are talking to these SMEs on a day-to-day basis. We are well connected through the AskMe Group (which has AskMeBazaar, AskMeGrocers, MebelKart, AskMePay and others) infrastructure so we can give them services which others can't. We also have AskMe Pay, which is a digital wallet and payment collection app for merchants. We already have three lakh merchants registered on it. They can digitally collect money through this app.
By the end of this month (March), my loan book would be more than Rs 30 crore. We have already given loans to 75 SMEs over the last 2-3 months. We have already tied up with 10-12 partners and are in talks with 10-20 more to expand our offerings. In the next three to six months, I am looking at my loan book growing 10 times to Rs 300 crore because I will be extending this service to all my AskMe merchants. I am in talks with most of the NBFCs and banks to provide easy financing solution to them. We are also in the process of getting some credit rating done for the SMEs. We have 15 million merchants registered with AskMe. There is a huge captive market for AskMe Fin. We want to grow to Rs 1000 crore in the next two years.
We recently tied up with a crowdfunding platform – Catapult, which is selling exclusively on our e-commerce platform. This is the unique thing that we are doing now. Nobody has thought of getting crowdfunding firms on their platform. We have also come out with innovative products to instil confidence in the lenders. Say, if he is not very sure about a seller's capability to pay because of his (seller's) uncertain earning, then we ask the disbursement to be made based on the weekly sales of the merchant. So, even if the loan is sanctioned, if the number of orders are big, he can take the higher disbursement, and if it is small then his disbursement is lower. Loan limits are based on turnover and we give only comfort to our loan partner, but no guarantee. No legal action can be taken against us as we are not party to contract between the seller and loan provider. We are only a platform. Every month, we are adding one or two loan products on our platform.
We are take a certain amount of commission from NBFCs and banks. We do not charge anything from sellers. Our growth is linked to the growth of AskMe businesses. The commission that we charge our lending partners ranges from half percent to 1.5%. The interest rate averages at around 1%. If we have a loan book of Rs 1000 crore in the next two years, then our income would be around Rs 10 crore by then.
