KARMALIFE: The perfect gig for low-income segment

Provides credit, insurance and pension for security & growth

industry, industry news
Rohit Rathi, co-founder & CEO, KarmaLife

Work and life have gone digital, finances haven’t—at least for India’s gig, contract and casual workers with small but genuine financial needs. KarmaLife is invested in empowering India’s 200 million+ non-salaried blue-collar workers by combining data, technology, and trust to offer flexible, small ticket, and affordable products tailored to the low-income segment.

KarmaLife is an AI-powered, 100% digital solution for the financial well-being gig workers. “Ours is a high engagement, scalable model powered by tech and trust,” says the co-founder & CEO, Rohit Rathi. “Our technology can personalise value at lowest cost and our philosophy is to reward good behaviour.”

Rathis is an IIT Kharagpur graduate and tech evangelist, who designed the country’s first tablet PC: NotionInk-adam. Explaining the business model, Rathi says, “At KarmaLife we enable financial inclusion by combining primary and secondary data. User-consented work and income data combined with behavioural data generated from digital footprint helps us in establishing and building a credit score for the new-to-credit or credit-invisible population.”

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Speaking on the role of technology, Rathi says, “By leveraging data analytics and AI algorithms to assess creditworthiness, we are able to offer credit and other financial products to individuals who may not have traditional credit histories, helping facilitate financial inclusion.”

The idea for KarmaLife was born in Rathi’s mind in 2017 when a landlord lowered the rent deposit for a house after identifying him as a successful entrepreneur who had received investments from Sachin Tendulkar for his previous venture. Rathi wanted to make this trust and belief, which led to the landlord lowering his ask, the core of his next venture to tap the financial segment. He then got on board Naveen Budda (CTO & co-founder), his colleague from Smartron, and Badal Malick (CBO & co-founder), whom he met through a common friend. When analysing the segment after his exit from Smartron in 2018, Rathi realised that the growing gig economy offered plenty of opportunities to build a fintech platform that could drive financial inclusion.

The three co-founders started working on KarmaLife in 2019, but the company was registered only in 2020. The platform’s model is predicated on dynamicity, and it follows its users’ journeys, their payment behaviours offering financial services based on those readings. The team piloted their product with a well-known company, and of the 2,000 gig workers, 700 used the product.

“The pilot demonstrated the effectiveness of KarmaLife’s product and confirmed our hypothesis about lending in the gig economy segment,” says Rathi. “The business, in terms of disbursement and revenue, grew 700% y-o-y, and the credit limit the company is providing currently is 70% of the user’s earnings.”

KarmaLife recently raised an undisclosed amount of funding. Earlier it raised $2.2 million in Pre-series A funding from Artha Venture Fund.

Going forward, KarmaLife’s future outlook is promising, with plans to expand its user base beyond delivery workers to include security guards, temporary staffing etc. The team also has a couple of new products in the pipeline, including a longer-term product where the user can get a larger ticket loan and a saving product in the next three months.

Also read: 35,000 invoices worth Rs 7,200 crore financed on TReDS every month: RBI Governor Shaktikanta Das


* It is an earnings-linked financial solutions provider to gig and blue-collared economy

* Offers flexible, small ticket, and affordable products to the low-income segment

* Platform leverages data analytics and AI algorithms to assess creditworthiness

* Business has grown 700% year-on-year

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First published on: 20-03-2023 at 02:30 IST
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