LoanTap, an online personal loan company with in-house NBFC, has secured its second-round funding at USD 4 million. The round comprises of a mix of equity and debt instruments from Kae Capital, India Quotient, IFMR and MAS Financial Services Ltd.
Equity infusion to the platform was led by Kae Capital with participation from its existing investors including India Quotient and HNI Investors. On the other hand, debt has been raised from leading NBFCs such as IFMR and MAS Financial Services Ltd.
Commenting on the development, Satyam Kumar, CEO, LoanTap, said, “We have been able to demonstrate that for discerning millennials, product experience far outweighs upfront pricing modules adopted by traditional lenders in India. Customers are choosing products that deliver flexibility, seamless experience and lifetime cost advantage over perceived financial benefits.”
“Satyam and Vikas together bring strong expertise in Credit, Sales and Technology. They have demonstrated strong growth and are able to differentiate with their innovative products and processes which make their value proposition very compelling,” said Navin Honagudi, Investment Director at Kae Capital.
Kshama Fernandes, MD and CEO, IFMR Capital, said, “LoanTap is an innovator in the fintech space, carving a niche position for itself and creating a competitive moat through its unique sourcing model. During our analysis and benchmarking, LoanTap’s objective of enhanced customer experience through technology and innovation is what we found most interesting.”
The innovation-driven platform features class leading credit quality and reported zero non-performing assets at the end of FY2017. At present, the platform is receiving 5,400 to 6,000 loan enquiries every month resulting in more than 600 files make initial cut and travel through robust credit process. The platform has received a sum of more than 47 thousand loan applications since its launch less than a year ago. 38 percent of LoanTap’s credit portfolio comprises the revolutionary EMI-free product, which requires an applicant to only serve monthly interest on the loan outstanding, while he can schedule principal payments, based on his projected incentive or bonus credits.
Loantap’s software carries out a complex set of underwriting on each application, which involves IP Address, Social Media and Identity searches on individual profiles built over traditional underwriting. Enhanced features of credit appraisal have led to lower credit risk trends in its portfolio.
Post funding Loantap aims to bolster collection features in its software, besides reaching out to tier 2 and tier 3 (major capital cities and business hubs) of India.