India’s first P2P lending NBFC Faircent rapidly expanding presence in tier-3 cities

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New Delhi | Updated: December 13, 2018 7:50:14 PM

Online peer-to-peer (P2P) lending platform Faircent -- first such lending site to receive NBFC certification from the RBI -- has tripled its loan disbursements in tier-3 cities since the last financial year, CEO and Founder Rajat Gandhi told FE Online.

P2P lending NBFC Faircent, Faircent, NBFC certification, RBI, Aarin Capital, PSU bankThe company focuses on bridging the credit gap in tier-2 and tier-3 cities, where several small businesses and individuals find it difficult to get loans from traditional banks and financial institutions due to lack of financial and credit records.

Online peer-to-peer (P2P) lending platform Faircent — first such lending site to receive NBFC certification from the RBI — has tripled its loan disbursements in tier-3 cities since the last financial year, CEO and Founder Rajat Gandhi told FE Online. Faircent claimed that its disbursements to tier-2 cities as well have nearly doubled during the same period.

Faircent uses an alternative credit evaluation mechanism which helps it to reach out to creditworthy borrowers. Another reason for the company’s growth, Gandhi says, is its recognition as India’s first NBFC-P2P, which has unlocked credit supply.

The company focuses on bridging the credit gap in tier-2 and tier-3 cities, where several small businesses and individuals find it difficult to get loans from traditional banks and financial institutions due to lack of financial and credit records.

Also read| India’s first P2P lending NBFC Faircent rapidly expanding presence in tier-3 cities

Faircent has expanded to over 450 cities in India, Gandhi says. “Awareness created through dedicated marketing efforts about P2P lending as an alternative organised credit medium over unorganised sector has helped us.”

Faircent currently has 5.5 lakh registered borrowers and 87,000 registered lenders on its platform, growing at more than 200% annually. The company has so far disbursed over Rs 55 crore in loans. The disbursements between SMEs and individuals is currently 65:35, said Gandhi.

“We have seen a multi-fold growth in the past year, both in terms of the value of transactions carried out as well as the demand for our products. Also, our latest research & analytics report shows that borrowers from these cities are making timely repayments,” said Founder and COO Vinay Mathews.

In September this year, Faircent reduced the interest rate on unsecured loans to 9.99% per annum for its prime borrowers. The company claimed it to be the lowest rate for unsecured loans offered by any private/PSU bank or alternative lending platform in the country.

Faircent has raised $9.8M so far across 7 funding rounds. Its investors include 3one4 Capital, Aarin Capital, Brand Capital, Muthoot Fincorp, and Incofin Investment Management, as per deals tracker Crunchbase.

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