Case View with Rajat Gandhi - P2P Lending in India: Delivering Disruptive Innovation in Alternate Lending Space

Rajat Gandhi,Founder & CEO
CASE VIEW WITH RAJAT GANDHI
P2P LENDING IN INDIA: DELIVERING DISRUPTIVE
INNOVATION IN ALTERNATE LENDING SPACE
Faircent is the India’s largest P2P lending marketplace for borrowers
and lenders to connect directly through its unique platform, which
allows Auction and Reverse Auction Indexation. Faircent’s dynamic
algorithms ensure that the right fit is done.
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November 2016
Interviewed
by
Dr. Nagendra V. Chowdary
Ref. BFS-2-0010B-2
Rajat Gandhi,
one of the earliest
professionals of
Internet in India,
gathered extensive
hands-on experience
in launching and
building Portals,
online Classifieds,
Communities,
E-Commerce and
Digital Advertising
businesses. Rajat
conceptualized
Faircent.com as the
India’s largest P2P
lending marketplace.
Rajat has over
20 years of
experience, out of
which 17 years are
in online and
digital space.

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Interview with Rajat Gandhi P2P Lending in India: Delivering Disruptive Innovation in Alternate Lending Space
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P2P Lending in India: Delivering Disruptive
Innovation in Alternate Lending Space
Rajat Gandhi
P2P Lending in India
1. What according to you is Peer to Peer (P2P) lending and how does it work in general?
What distinguishes P2P lending from the earlier moneylenders/pawn-brokers (still
prevalent in some pockets of Indian landscape, especially in rural and semi-urban
areas)? How would the presence of traditional moneylenders affect the business
prospects of P2P players?
Peer to Peer lending, is the practice of lending money to individuals or businesses through
online services that match lenders directly with borrowers. By bringing the lenders and
borrowers directly in contact with each other through an online marketplace, P2P lending
removes intermediary margins and reduces overhead costs benefitting both. As a result,
lenders can earn higher returns compared to savings and investment products offered by
banks, while borrowers can borrow money at lower interest rates.
The biggest impact that P2P lending has created was empowering the borrowers i.e., both
the lender and the borrower could directly negotiate with each other and the borrower
could select loans at the lowest interest rate. Faircent operates on the reverse auction
model, which allows the borrower to accept or reject an offer or even make a counter offer.
Whereas, traditional moneylenders insist on collaterals, we evaluate the creditworthiness
of the borrower based on his ability, stability and intent to pay through his financial, social
and personal background. These marketplaces offer loans without any collateral after
checking the borrower’s credit worthiness, thus making it different from pawnbrokers who
traditionally believe in collateral backed loans. Moreover, P2P lending marketplaces are
aggregators who provide an online platform for the borrower and the lender to come
on-board.
P2P lending helps bridge the gap between demand and supply of funds. Using technology,
it brings easier and faster access to funds for credit starved borrowers, retailers as well as
SMEs. As increasing NPAs of Indian banks brought in more stringent rules for acquiring

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P2P Lending in India: Delivering Disruptive Innovation in Alternate Lending Space Interview with Rajat Gandhi
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credit, it has become difficult for SMEs in accessing credit. P2P platforms can help mobilize
these credit requirements, which in turn can fuel the economy.
2. What are the differences between financing through banks and financing through
P2P platforms? Is P2P financing a complementary or competitor to conventional
banking?
Currently, P2P financing, globally, is complementing banks and NBFCs providing faster and
easier access to funds.
The P2P lending business model was pioneered in the US and UK around 10 years ago and
has since then spread around the world. The sector expanded rapidly after the 2008 crisis
when Central Banks everywhere sharply lowered interest rates. This raised the gap between
the very low interest rates that consumers were paid on their deposits and the fairly high
rates they still had to pay on all types of loans, for example, credit card loans. This gap
created an opening for P2P lenders whose basic value proposition was cutting the costs of
intermediation between lenders and borrowers which allowed lenders to earn a higher
rate of interest and borrowers to pay a lower rate. This was achieved by using large data
sets and clever algorithms to determine the creditworthiness of borrowers using a range
of variables like credit scores, financial history and social media usage. Over the years,
the business model has evolved and in particular there has been a rise of institutional
investors who use P2P platforms to build a loan portfolio.
InIndia,theP2Pindustryisstillsmallwitharound30companies.Perhapsthemostpromising
long-term application of P2P lending here is in enabling financial inclusion. For the last
50 years, a shortfall of lending to groups like small farmers and small enterprises has been
a major concern. It is difficult for a conventional bank to serve these customers because it
is costly to build bank branches and hire loan officers and therefore uneconomical to lend
to customers who borrow small amounts. Such customers also struggle to produce the
The basic value proposition of P2P lending is
cutting the costs of intermediation between lenders
and borrowers which allow lenders to earn a
higher rate of interest and borrowers to pay a
lower rate.
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documentation needed to obtain a bank loan. As digital natives grow older and use more
financial products, as the P2P lending industry matures and gains credibility, it may gradually
erode the conventional bank lending model.
3. In India, we get to see two types of P2P lending players – largely Social P2P lenders
(Rangde, Milaap, Kiva, etc.) and Business P2P lenders (Faircent, i-Lend, Lendbox,
IndiaLends, InstaKash, i2iFunding, etc.). What distinguishes these two types of P2P
lenders apart from their respective purposes? Which of these two do you foresee to
have a sustainable business over the next few decades?
Donation or grants are not an asset class. What we are focusing on is creating an alternative
asset class which provides return on investment to its lenders. We are building a business
model which will self-sustain and grow. Profitability is never compromised but at the same
time the idea is to take the benefits to every strata of the society and ensure financial
inclusion for all. Philanthropy has been part of the society for time immemorial and has its
advantages.
4. How do you see the growth parameters of P2P lending in international as well as
Indian scenario? How different is it operating such a business in India vis-à-vis global
platform?
As of this moment, the P2P landscape in India is unregulated, however, eyeing huge
potential disruption, the Reserve Bank of India (RBI) recently came out with a consultation
paper and has proposed to register P2P lending platforms as Non-Banking Financial
Companies (NBFCs). What’s noteworthy is that the generally reactive RBI has this time
proactively reacted to changes in the market. Apart from the special NBFC stature, the
consultation paper talks about six prime areas including permitted activity, reporting,
prudential and governance requirements, business continuity planning and customer
interface.
Investment in India’s Fintech industry grew 282% between 2013 and 2014, and reached
$450 million in 2015. A fair portion of it accounts to P2P lending.
5. What according to you are the business and revenue models of P2P lenders? How do
they make money? What are the different models/formats that P2P players adopt to
differentiate themselves?
P2P lending platform uses simple business model. For example, at Faircent, borrowers and
lenders interact amongst themselves to decide a mutually agreeable rate for their
transactions (loans). Our mission is to provide a marketplace that uses technology to speed

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up the process and cut costs. Thus, we provide an opportunity to the borrowers to get their
requirements funded at viable rates and help lenders get the best possible return on their
investment.
We charge a registration fee of INR500 to get a borrower onto the platform. This is basically
to cover for the back-end work we do to assess and verify his documents. A nominal
processing fee is charged only after the requirement is funded. From lenders, we charge a
listing fee of INR500 to invest up to INR50,000 and INR1,500 to invest up to INR1,50,000
from lenders. This fee is due at the time of registration. Thereafter, for every lakh of rupees
invested the fee will be INR1,000. It is a listing-based model/subscription model.
6. How do P2P players reach out to the potential borrowers? How does one go about
lending using these platforms?
On Faircent, visitors, as per their requirement, can register as lenders or borrowers. Faircent
undertakes a comprehensive verification process basis personal, financial and professional
information provided of all its registered borrowers and lenders.
The whole process works on a reverse auction system. An automated underwriting system
assigns the loan period, loan amount and indicative maximum interest rate against each
borrower’s profile. Lenders can make offers to fund borrower’s requirement at similar or
lower interest rates than assigned, which the borrower can accept or refuse. Borrowers
too can approach willing lenders with their loan proposals. Offers consist of amount to be
lent and the applicable interest rate. Both borrowers and lenders can strike deals with
multiplemembers.Thus,lenderscanfundaportionofthetotalloanrequirementofmultiple
borrowers and borrowers can seek to raise money from multiple lenders.
Faircent empowers the borrower by having a
transparent rate discovery model and enabling
them to reduce interest rate through a unique
reverse auction model, where multiple lenders bid
for borrowers and each borrower has the power to
accept or reject an offer.
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Once an agreement is reached between the borrower and the lender, a formal contract is
signed by them. The lender then transfers the amount to the borrower’s account and the
borrower makes periodic repayments through EMI mode over the stipulated time period.
7. The interest rates charged by P2P lenders, as several industry veterans and analysts
argue, are quite high (ranging between 9.5% and 36%). How does this help increase
penetration of P2P lending in India?
Rate of lending by traditional moneylenders’ crosses 50%, Banks and NBFCs provide loans
at 12%-36% (additional 1%-2% prepayment charges), credit cards charge from 18-40%.
Currently Faircent.com provides loans at 12%-28% (with no prepayment charges). These
charges are also account for the tasks like verifying borrowers and lenders, facilitating
legally-binding contracts between borrowers and lenders and helping in collection of
payments. We think our fee and interest rates are fair and the idea is to attract serious
borrowers who genuinely need funds for a legitimate purpose and have every intention to
repay.
8. What are potential benefits of leveraging the P2P platform for both borrowers as
well as lenders?
The basic value proposition of P2P lending is cutting the costs of intermediation between
lenders and borrowers, which allow lenders to earn a higher rate of interest and borrowers
to pay a lower rate. This is achieved by using large data sets and clever algorithms to
determine the creditworthiness of borrowers using a range of variables like credit scores,
financial history and social media usage. Lenders can also look at P2P lending as an alternate
asset class and diversify the risk by building a portfolio. For the borrowers, P2P lending
allows fair and easy access to credit.
P2P lending often tend to compliment the
available banking ecosystem. With more P2P
players entering the market, there is a lot of
expectation of the market witnessing a fair
competition, which would eventually help in
reducing interest rates.
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9. What according to you are the potential risks for a P2P lender and how can they be
addressed effectively?
The inherent risk is that the borrower may default on the payment. Having said that, every
market-linked investment whether it is stock market or Mutual Fund (MF) has some risk
attached. It is the ability of the business to manage or mitigate risk. The first step is that
Faircent ensures that only the most genuine borrowers with the ability, stability and intent
to fulfill their loan agreement are registered on the platform. We evaluate each and every
borrower across more than 55 parameters basis their financial, personal and social data.
Secondly, Faircent encourages lenders to spread their risk by capping an individual lenders
investment in a particular borrower to 20% of the borrower’s requirement. Thirdly, Faircent
ensures a legally binding agreement between the borrowers and lenders. Fourthly, Faircent
has a diligent payment collection process i.e., we follow up EMIs and other payments and
ensure timely transfer of the same. Still if default does happen, Faircent sends a legal
notice on behalf of the lenders to aid in the recovery process.
10. What are the pros and cons of P2P lending?
a. P2P Players: P2P lending often tend to compliment the available banking ecosystem.
With more P2P players entering the market, there is a lot of expectation of the market
witnessing a fair competition, which would eventually help in reducing interest rates.
b. Borrowers: It offers borrowers faster and easier access to credit at low interest rates.
P2P lending helps bridge the gap between demand and supply of funds by providing
access to loans to borrowers (individuals, SMEs and micro SMEs), who have been
denied access or are under-served by the traditional financial institutions. With
increasing NPAs of Indian banks and hence, more stringent rules for acquiring credit,
it has become even more difficult for SMEs and Micro SMEs to collect funds. P2P
platforms can help mobilize these much-required funds, providing greater access of
loans to borrowers thereby fueling the Indian economy.
c. Lenders: P2P lending is a new asset-class competing with other market-linked,
risk-based investments like stock markets, MFs, Systematic Investment Plans (SIPs),
etc. Currently, on Faircent, 90% of our lenders are earning gross returns between
18-26% and net returns of 18-24%. This is higher than the average returns an investor
can expect from other such investment opportunities. Also, MFs and SIPs generally
have a lock-in period, whereas P2P lending ensures that both principal and interest
can be received from the very next month onwards.

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11. What is the role of technology in shaping P2P landscape in India? Wouldn’t the cost
of technology be an entry barrier to serious potential P2P players?
Technology plays a huge role in shaping P2P landscape in India. Unlike traditional banks,
P2P lending marketplaces does not believe in brick and mortar model rather major chunk
of our investments goes into technology. One of the major drivers of our business is our
ability to provide presence-less and paper-less environment for financial services. This
requires a huge, efficient, state-of-the-art, tech-enabled back-end.
12. How is P2P different from crowdfunding?
In a way crowdfunding is kind of equity funding while P2P lending is an asset class dealing
primarily in personal loans.
Crowdfunding is typically used for specific projects or ideas and not for personal loans.
The second distinct difference is that investors who contribute to a project do not get
interest–instead they will receive rewards, special perks, or gifts. For example, they may
get the first release of an album or the product they supported. The core concept of P2P
lending lies in the fact that it is a business transaction between a group of investors with
surplus funds and a person or business that needs funds without the interference of
traditional financial institutions. Usually, the investors are individuals who are not related
to and do not know the borrower.
13. Many industry analysts and a quite a large number of customers complain that
regulatory framework needs to be strengthened bereft of which P2P lending may go
the same way as that of MFIs in India. What are your suggestions for strengthening
the regulatory framework? What are the specific areas that need to be strengthened?
If the guidelines are framed in an intelligent, prudent and practical manner, it is always
good for any industry. The regulator is an equal partner in the growth and value provided
to the consumers. If regulations are given out keeping in mind the interest of the consumer,
they bring immense value like we have seen worldwide in the case of P2P lending. As the
discussion paper released by RBI paper states it would allow borrowers to access loans at
much lower costs or give access to credit to SME/Micro SMEs. Access to loans till now was
either denied or under-served by the traditional financial institutions.
14. Is the RBI’s proposed approach to regulating the platforms adequate?
With proper regulations in place, it will help enhance the public’s confidence in the sector
and facilitate proper growth for the industry, which is currently at a nascent stage. However,

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the regulation should be supportive of innovation and not stagnating. The objective should
be to control the unruly practices rather than posing barriers for Fintech adoption in the
country. Hence, the devil is in the details of the regulations and the guidelines, they should
be enabling.
15. One of the biggest global success stories in P2P lending has been Lending Club in US,
becoming 14th
largest bank in the US. What lessons and best practices can be learnt
and adopted in India from the successful model of Lending Club?
Lending Club works on a different model in a different more open as well as more mature
economy. However, there are some features and practices that are common with our model
such as fractionalization of loans – we don’t allow more than 20% contribution from a
lender in one loan. Also, depersonalization of borrowers already in practice at Lending
Club is something that we hope to achieve soon. Here, data pertaining to the borrowers is
extensiveenoughthatthenameisnotimportantforthelenders.Thisisextremelyimportant
to drive scale in business. They have also managed a mix of investors whereas we are still
focusing on individual investors. There are learning from every success story but they
need to be adapted as per the business environment we are operating in.
16. How do you see the competitive landscape of P2P financing space in India over the
next decade?
Investment in India’s fintech industry grew 282% between 2013 and 2014, and reached
$450 million in 2015. A fair portion of it accounts to P2P lending.
There is huge potential in the Indian market as there are plenty of unutilized funds and
many more in need of such funds. With the help of technology, P2P lending can bridge this
gap. For example, a major portion of the loans transacted are by micro and SME sectors
and there are 57.7 million small businesses in the country.
Unlike traditional banks, P2P lending
marketplaces does not believe in brick and mortar
model rather major chuck of our investments goes
into technology. One of the major drivers of our
business is our ability to provide presence-less and
paper-less environment for financial services.
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Moving forward, technological developments are likely to make P2P lending safer and
faster and with proper government support and regulation, P2P market in the Indian space
can attain a size of $4-5 billion in the next 5-6 years.
17. What do you think are the impediments for the future development of P2P lending
in India? What should be done for an orderly growth of this kind of alternate financing
option? How do you foresee the future of P2P lending in India? How do you see the
investments into the sector to maintain the growth prospects?
The main impediments are credit risk (high levels of delinquency) and fraud
(misrepresentation or deliberate wrong presentation of facts by borrowers or lenders). We
are actively working and ensuring that the same are mitigated and remain under control.
At an operational level, ensuring legally binding, contractual obligations puts huge stress
on resources and we hope in the future through prudent government policies this can be
automated and taken completely online. With the launch of Unified Payment Interface
(UPI), flow of funds will become faster and smoother and this will provide a huge boost to
the sector.
Orderly growth can be achieved by removing the above impediments through government
support. The next level of growth for the sector will come through establishment of a good
secondary market for loans. Loans should be allowed to be traded and demat. This will
help achieve greater liquidity and hence lender interest will grow.
Faircent is the only P2P lending marketplace
which transparently showcases the performance
data of all its borrowers on its website including
loan amount, interest rate, timely/delayed
payments etc. This empowers investors to take
informed decisions. We were the first to have a
detailed android app for our lenders to trade on
our platform real time.
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18. What according to you would be the five Critical Success Factors for a seasoned P2P
lending player in India?
At the expense of sounding cliché, customer is the king and today’s customer will not
settle for anything but the best. We have to ensure that the data is trustworthy, maintain
transparency, establish automated and tech-enabled processes at all levels. The key is to
ensure fast, easy, smooth, trustworthy processes for both lenders and borrowers at every
stage from registration to bidding to disbursal to collection.
Faircent
19. What was your background and what has triggered you to kick-start a P2P lending
business in India? What has been its financial performance since inception? Do the
margins warrant risks? What are the unique features of Faircent’s platform vis-à-vis
its competitors?
I started my career with the Times Group and was involved in multiple initiatives. As part
of the founding team of Times Business Solutions Limited (TBSL), the holding company of
brands like Timesjobs.com, Magicbricks.com and Simplymarry.com, I was instrumental in
the launch and growth of these brands. After Times, I headed Performics in India, a digital
marketing agency of Chicago-based Publicis Group.
The idea of Faircent was born with a personal experience that I had from one of my
colleagues in 2011. He used to borrow small loans from multiple other friends to fulfill his
needs at a specific point of time. For example, he once wanted to buy a Bullet and he had
posted on Facebook requesting his friends and family for a portion of the funding, and in a
week, he was riding his Bullet to office. This incident, coupled with my knowledge gained
from reports on mobile payments, online media and my experience in building exchanges
previously (for matrimony, jobs & property), I felt that Faircent could be the next logical
step to move into P2P finance. We realized that there was a mismatch in the demand and
supply of funds and also the potential to bridge that gap using technological advancements.
Faircent has performed tremendously well. The current registered borrowers are at 30,000
and registered lenders are 6,000. We have disbursed more than INR10 crores of funds till
date and have crossed the INR1 crore mark per month. Faircent mission is to use innovation
and technology to meet credit on demand at reduced cost and higher speed. With this in
mind, we built Faircent as one of the best tech platforms in the world, which integrates
with global players like Transunion, and Yodlee. Our borrower and lender screening process

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is a major differentiator. We use technology to the hilt to appraise borrowers on over 150
parameters. Our algorithms are able to assess not just ability & stability but also the
intention of the borrower to pay back the loan.
FaircentistheonlyP2Plendingmarketplacewhichtransparentlyshowcasestheperformance
data of all its borrowers on its website including loan amount, interest rate, timely/delayed
payments etc. This empowers investors to take informed decisions. We were the first to
have a detailed android app for our lenders to trade on our platform real time.
20. What are the business and operating models of Faircent’s P2P lending?
Faircent provides a platform where highly curated borrowers and lenders interact amongst
themselves to decide a mutually agreeable rate for their transactions.
Our purpose is to use technology to speed up the process and cut costs. By using a multiple
datapoints(traditionalandnon-traditional),weareabletoanalyzeandassesstheborrowers
better. Faircent indexes borrowers based on their purpose of loan, amount and tenure.
Similarly, it indexes lender requirements on amount to invest and expected return on
investments.Faircentempowerstheborrowerbyhavingatransparentratediscoverymodel
and enabling them to reduce interest rate through a unique reverse auction model, where
multiple lenders bid for borrowers and each borrower has the power to accept or reject an
offer.
Thus, we provide an opportunity to the borrowers to get their requirements funded at
viable rates and help lenders get the best possible return on their investment.
21. What should be the profile of lenders and borrowers who wish to offer or lend credit
through your P2P platform? Can one person act as both a borrower and an investor?
What is the process of due diligence at Faircent and how would Faircent’s technological
tools help in providing the credit score to the borrowers?
There are various thresholds in order to be eligible to be a lender on Faircent. For example,
he needs to be at least 25 years of age, he should have a record of investing in fixed
deposits, stockmarketoranyotherinvestmentproductthroughatradingorDEMATaccount,
and he should not have interest income of over 30% of Gross Income and many more.
Similarly, to be an eligible borrower on Faircent, a person needs to have a minimum gross
income of INR3 lakh per annum amongst other things.

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We strongly recommend that Lenders should invest from their surplus income and not
borrow to do the same and hence one person cannot act as both a lender and a borrower.
Faircent undertakes a detailed verification process following KYC norms as laid down by
various regulators. We have a strict listing criterion for evaluating each and every borrower
before they are allowed to be on the platform. Faircent physically checks their office and
residential addresses, it verifies their income statements, payment capabilities, past
performance in order to understand their ability, stability and intent. Faircent evaluates
each borrower on more than 55 criteria.
We do not match the borrowers and lenders.
The whole model works on transparency and
choice. We provide enough data on their
dashboard for them to make an informed decision
on who to lend to or from whom to borrow. Infact
we would in the future like to move to complete
de-personalization of borrowers and lenders where
only the data about them is the decision enabler.
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Similarly,alllendersarealsothoroughlyverified.Faircentensuresthatonlythemostgenuine
lenders are interacting with the borrowers, hence, every potential lender is registered only
after they give an undertaking about the authenticity of their credentials, income details
etc.
To evaluate the risk profile of a borrower, Faircent analyzes multiple types of data points
that include their social data from LinkedIn and Facebook, financial data from their bank
statements and credit card, including their history of servicing loans. These help Faircent
take note of the ability, stability, past performance and intention of the borrowers.

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22. How does Faircent’s P2P platform technology enable direct matching of borrowers
and lenders? How does the platform ensure standardization of services rendered?
We do not match the borrowers and lenders. We provide them with a platform and standard
tools like filters and search to find each other. The whole model works on transparency and
choice. We provide enough data on their dashboard for them to make an informed decision
on who to lend to or from whom to borrow. In fact, we would in the future like to move to
complete de-personalization of borrowers and lenders where only the data about them is
the decision enabler.
23. How does Faircent calculate the interest rates for its borrowers and what is the average
rate of return for lenders?
Based on the required documents, every borrower is identity-verified, credit-checked and
risk-assessed and our automated underwriting engine will determine the maximum loan
amount, rate of interest and the loan tenure at which the borrower can take a loan. The
maximum recommended rate of interest ranges from 12% to 28% and the loan tenure from
6 to 36 months. The average rate of return for lenders is between 18-24%.
24. One of the biggest casualties of MFIs has been loan recovery rate? What has been
Faircent’s experience in loan-recovery? Does Faircent adopt any unique recovery
practices to encourage effective recovery process?
Because of the rigorous verification process followed by Faircent, default rates have been
as low as 1.5%.
In case a payment has been delayed, an additional penal interest of 24% p.a on the amount
due for the period lapsed after the due date or INR50 whichever is more + INR250 cheque
bounce charges per lender is levied. Borrowers are liable to pay these directly to their
lenders.
In the worst-case scenario, we facilitate the collection through our in-house collection
mechanism and also send a legal notice on behalf of the lender to the borrower. In case
the money is still not recovered, we hire reputed, legally-compliant, recovery agencies.
The expenses incurred by the recovery agency are borne by the lender. The lender can use
the legally binding contract signed by the borrower to take him to court to recover the
monies.

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25. What are your plans to propel the size and reach of Faircent’s business prospects?
We are looking at closing this financial year with business transactions at INR50 crore.
Next year, we are looking at around INR200 crore (2017-18). Then within the then next 3 to
4 years, we are hoping to reach at around INR2,000 crore of business transactions.
26. What are the 3 biggest challenges for Faircent’s business prospects and how would
they be overcome?
At a nascent stage, Faircent had plenty of challenges to overcome. For example, we have
invested heavily in building and re-building our underwriting mechanism. High delinquency
ratio, fraudulent data or misrepresentation of facts by borrowers or even lenders is a fact
in this business and we have to build a system that can mitigate that risk. It is our biggest
priority.
Faircent has tied up with Baxi, the on-demand bike
taxi aggregator, to provide easy access of
two-wheeler loans to Baxi drivers. This is the first
time in India that a P2P lending platform has
introduced loans against collateral.
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27. What would be your suggestions for deepening the reach and improving the
effectiveness of P2P lending in India?
We believe that, transparency boosts customer confidence. Platforms will be able to retain
a customer only by exceling in our technology, communications and the services rendered.
Hence, it would be highly imperative to thrust on technology, maintaining transparency,
establishing automated processes at all levels to deepen our reach and improving the
effectiveness. We also believe that a massive education embankment on P2P lending
across the country is the need of the hour. RBI is certainly doing its bit by bringing in
guidelines for the sector.

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28. In a first-of-its-kind move, Faircent has introduced loans against collateral for its
lenders. Can you brief on this new product offering of Faircent?
Faircent has tied up with Baxi, the on-demand bike taxi aggregator, to provide easy access
of two-wheeler loans to Baxi drivers. This is the first time in India that a P2P lending
platform has introduced loans against collateral. This serves Faircent’s goal to provide
easier access to credit and lead the way in democratizing financial services. Faircent is
planning to introduce a series of asset-based investment products by exploring similar
options with other large businesses to extend trade advances to their channel partners,
retailers as well as distributors.

Case View with Rajat Gandhi - P2P Lending in India: Delivering Disruptive Innovation in Alternate Lending Space

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Case View with Rajat Gandhi - P2P Lending in India: Delivering Disruptive Innovation in Alternate Lending Space