Unicorn India Ventures, a Mumbai-based VC firm, has announced its investment in Bangalore-based startup SmartCoin. Unicorn has led the round with participation from a clutch of angel investors. This is Unicorn’s seventh investment from its maiden fund. The Fund has already announced investments in six startups – Roder, Grab on Rent, VanityCube, Pharmarack, Inc42 and NeuroEquilibrium.
SmartCoin, a Bangalore-based data-driven micro lending startup, was started by IIT/IIM alumni Rohit Garg, Amit Chandel, Vinay Kumar Singh and Jayant Upadhyay last year, who come with around a decade of work experience across finance and technology domain before joining hands to start this venture.
SmartCoin is a mobile app based lending platform, capable of assessing the risk profile of a prospective borrower in real time, using data science and machine learning algorithms. Their proprietary credit underwriting engine aggregates thousands of data points on a customer’s smartphone, including financial transactions, device usage and app behavior, to build a customized credit score. A customer is instantly offered personalized loan products on the basis of his risk and capacity, and the money is transferred digitally to the bank account. All that a customer needs is a bank account, Aadhaar card and social media presence. The entire process, from app download to loan approval, takes less than five minutes providing an unprecedented customer experience.
“The idea behind SmartCoin is new age. The technology has been designed keeping the end customer at the heart of it, thus ensuring convenience in filling in their information and offering them a loan product suited to their needs. The concept of app based micro lending has proven successful in several other emerging markets and we see a huge potential in such a business model for India,” says Archana Priyadarshini, Venture Partner with Unicorn India Ventures, who has recently joined Unicorn to head their Bangalore office. She will also be joining the board of SmartCoin and will be working closely with the team to scale up their business.
Since its’ launch last quarter, SmartCoin has disbursed more than 3,000 loans and is growing over 50% MoM. SmartCoin plans to disburse 50,000 loans by the end of next financial year. The company is partnering with leading NBFCs and microfinance companies, who are looking to leverage their technology to expand customer base.
Rohit Garg, Co-founder and CEO, SmartCoin, says, “Traditional underwriting methods are largely reliant on credit histories, and thus unable to serve people with limited credit data. As a result, there is a huge underserved segment spanning not just the corporate workforce, but also the emerging aspirational class working in semi-white collar and blue-collar jobs. We believe credit should be accessible to everyone, and the process should be as simple as online shopping or cab booking.” He adds, “Long term partnerships with NBFCs are beneficial to everyone in the ecosystem. These borrowers, traditionally underserved by the financial institutions owing to thin-file or no-file data, are generating a lot of digital data as a result of deepening smartphone penetration. Our data-driven technology can score them more accurately reducing the risk of underwriting and opening newer growth avenues for NBFCs.”
The funding round raised will be used for upgrading technology platform and to scale up operations.
Unicorn has done the first close of their maiden fund. The Fund has already announced investments in startups like Grab on Rent, Inc42, Neuro Equilibrium, Vanity Cube, Roder, and Pharmarack.