The startup, which caters mainly to second-hand two-wheeler buyers, has an average loan size of Rs 52,000 and a longer repayment cycle than its peers.
Online payments platform, Paytm has announced to invest $5-10 million (about Rs 33.5-67 crore) in Mumbai-based digital lending startup CreditMate in the second round of funding after it first infused an undisclosed sum in late 2017, according to people close to the development.
CreditMate chief executive officer Jonathan Bill said that following the fundraising last year the company has been growing at 40% month-on-month in terms of the number of loans disbursed. He did not comment on the investment by Paytm. The startup, which caters mainly to second-hand two-wheeler buyers, has an average loan size of Rs 52,000 and a longer repayment cycle than its peers.
“The first 12 to 18 months have been very well in terms of business and we have managed to restrict repayment failures to less than 1%,” said Bill. Paytm did not comment on the investment. Meanwhile, with the help of Paytm, CreditMate is expected to venture into automobile insurance soon. CreditMate has disbursed around 10,000 loans after having received more than 15,000 applications. It has also started financing new vehicles.
“More than 60% of our customers are new to credit and more than 50% are self-employed. Hence we use technology to assess the borrower,” said Bill.