BharatPe forays into consumer lending with latest peer-to-peer feature

• This feature will allow users of the BharatPe app to lend money to each other at an interest rate of up to 12% annually.
• The company aims to generate a capital pool of $100 million and lend up to $50 million from this product by March 2022.
• BharatPe has disbursed over $300 million in business loans to over 2 lakh merchant partners under its P2P offering.

Fintech startup BharatPe, which largely focuses on merchant payments, has forayed into consumer lending with the launch of its latest peer-to-peer (P2P) lending app named 12% Club.

The platform will allow users to invest their savings — within the range of ₹10,000 to ₹10,00,000 — in a 12% Club app. The company will increase the upper limit of investment to ₹50,00,000 over upcoming months.

This amount will later be used to give out loans of up to ₹10,00,000 to customers at a 12% annual interest rate. The loan will be collateral-free for the first three months and the company will charge no processing or pre-payment charges on these loans.

The consumers investing via the 12% Club app can put in a request to withdraw their investment anytime, partially or completely, without any withdrawal charges.

The loan eligibility will be defined based on several factors such as customer’s credit score, shopping history using multi-brand loyalty programme PAYBACK or payments done through BharatPe QR code.

The company aims to achieve an investment asset under management/capital pool of $100 million and a lending of $50 million from this product by March 2022.

Suhail Sameer, chief executive officer (CEO) of BharatPe said, “In the pilot phase, we have seen great traction with $5 million of monthly investment run rate and $1 million of monthly borrowing run rate. We are confident that this product will be well received in the market and will play a key role in driving financial inclusion in the country. This is just the beginning and we will be adding new customer products during the rest of the financial year.”

Sameer further noted that their P2P lending product for merchants has witnessed a gross investment of close to $700 million by 6.3 lakh merchants. The company claims to have disbursed over $300 million in business loans to over 2 lakh merchant partners.

Earlier this month, Kunal Shah-led credit card payments app CRED enabled a peer-to-peer (P2P) lending feature called CRED Mint for its 7.5 million members. The feature will allow users of the CRED app to lend money to each other at an interest rate of up to 9% annually.

SEE ALSO
Khatabook’s valuation touches $600 million with zero revenue to showHike raises money for the first time in five years to experiment with crypto and gaming
Swiggy, ShareChat, Byju’s lead the funding race as Indian startups raised $6.5 billion between April and June