Credit Fair is a fintech firm that offers 0% or low-cost, short-term, unsecured installment loans at the point of sale. The startup's one-of-a-kind credit evaluation process has enabled them to reach a TAT of less than a day and a high acceptance rate, allowing more Indians to get credit. Apart from that, Credit Fair assists borrowers in establishing a credit ladder or a loans score that will enable them to obtain credit from other lenders at a more favorable rate. Credit Fair has onboarded over 1,000 merchants in just three years, including UpGrade, Toppr, and Asian Paints, to name a few. It has disbursed over $9 million to date and now has a loan book of $4 million.
Credit Fair Startup - Company Highlights
- Startup Name - Credit Fair
- Founded 2018
- Industry - Fintech
- Founder - Aditya Damani
- Headquarters - Mumbai
- Website – www.creditfair.in
Credit Fair Startup - About
Credit Fair offers 0% or low-cost, short-term, unsecured installment loans at the moment of sale. Their short-term goal is to become the preferred lender in the education, healthcare, home décor, and electric vehicle sectors and their long-term goal is to provide every Indian with the appropriate quantity of credit at a reasonable cost and at the proper time. The firm hopes to have a beneficial impact on the financial lives of over 1 million Indians by 2025.
Fun Fact : Credit Fair aims to make low-cost loans available to 'Bharat' or those who didn't get them from banks or giant NBFCs.
Credit Fair Founder - Aditya Damani
Aditya Damani, the company's creator, has a unique mix of fintech and institutional lending experience. He has previously received a Banking Tech award while working at new-to-credit lender Oakam and TransferWise. In addition, he's previously worked at PIMCO, where he advised private equity funds to start lending companies.
Over 50 people make up the team, including people who work in technology, credit, collections, sales, finance, and marketing. The crew is youthful and enthusiastic about the company's objective, as seen by the values of ownership, curiosity, and obsessive client satisfaction.
Credit Fair Startup - Financing and Investors
Credit Fair has raised a total of $15 million in investment from Anand Ladsariya & Alok Agarwal in Debt & Equity on June 2021 in its Seed funding round.
Fair Credit Startup - Product/Service and USP
- Since Fair Credit is new to Credit (NTC) or does not have a prime credit score, almost 550 million Indians are underserved by traditional lenders.
- Credit Fair offers 0% or low-cost, short-term, unsecured installment loans at the moment of sale.
- Its ticket prices range from $150 to $25,000, with a three-month to three-year duration.
- Its one-of-a-kind credit evaluation process has enabled them to reach a TAT of less than a day and a high acceptance rate, allowing more Indians to get credit.
- Offering 0% or cheap EMIs extends access to low-cost loans and safeguards the borrowers' financial health.
- Credit Fair's products and high TAT and approval rate assist merchants to enhance conversions and maintain predictable cash flows for their clients, addressing difficulties such as poor sales and a shortage of working capital.
- Digitizing cash flows will assist retailers in better managing their cash flows, resulting in operational efficiencies.
Credit Fair Startup - Revenue Model & Business Model
Credit Fair operates on a B2B2C paradigm. Providing 0% or low-cost, unsecured installment loans at the point of sale, short-term, create a favorable situation for merchants and customers. The merchants bear the interest charges of these loans to recruit new clients, while the borrowers seek installment loans to manage their finances. Borrowers must also pay a small processing fee and, in some situations, an insurance cost.
Fun Fact : Credit Fair uses tools like - Slack for team communication, OKRs for goal setting and tracking, Jira for sprint planning, and third-party services to manage some commercial processes.
Credit Fair - Challenges
Some of the challenges of the company are as follows:
- Aligning the Team - The primary challenge was aligning the various teams inside the organization to focus on the company's goals while controlling risk. The separate teams, such as credit, operations, and collections, all had their own goals, which sometimes didn't contribute to the company's growth or conflicted with the goals of other departments.
- Competitors – Fair Credit has over a dozen competitors in the market. However, most of them are good players, and it is one of its main challenges.
Fair Credit Startup - Competitors
Bajaj Finance is its Fair Credit main competitor are:
- Bajaj Finance
Credit Fair Startup – Future Plans
UpGrad, Toppr, Indira IVF, Pristyn Care, Toothsi, Asian Paints, and Ampere are the 1,000 merchants onboarded by credit. It has disbursed over $9 million to date and now has a loan book of $4 million. The startup is growing at a 15% month-over-month rate. Credit Fair hopes to build agreements with 5,000 shops in the next two years, resulting in monthly disbursements of $15 million. It is developing products to reach a $15 million monthly disbursement rate and $75 million in assets under management in two years. The monies will get utilized to provide loss insurance, increase the team, and market the company. It also intends to develop a peer-to-peer lending network to reduce its funding expenses further and keep costs low for its consumers.