BharaPe enters P2P lending with '12% club', taps NBFCs to sell product

The '12% club' will allow consumers to not only earn up to 12% interest on the funds they invest but also borrow at an interest rate of 12%

BharatPe on Tuesday said it has entered peer-to-peer (P2P) lending with its product '12% club', which will allow consumers to not only earn 12 per cent interest on the funds they invest but also borrow at an interest rate of 12 per cent.

The fintech company has partnered with central bank approved non-banking finance companies to offer this product to consumers and is aiming to achieve an investment asset under management (AUM) of $100 million and a lending AUM of $50 million by March 2022.

Consumers on the '12% Club' app can invest their savings anytime by choosing to lend money through BharatPe’s partner P2P NBFCs. Additionally, consumers can avail of collateral-free loans of upto Rs 10 lakhs on the '12% Club' app for a tenure of three months, as per their convenience. There are no processing charges or pre-payment charges on the consumer loans, the company said in a statement.

Loan eligibility of the customer will be derived upon from his/her credit score, the shopping history using PAYBACK loyalty system or the payments done through BharatPe QR.

The upper limit for investment by an individual is currently set at Rs 10 lakhs and would be increased to Rs 50 lakhs over the next few months, the company said.

Credit card payments platform, Cred, also launched a P2P lending product recently called “Cred Mint”, where it is offering its members to earn up to 9 per cent interest by lending to other members and borrow at 12-16 per cent.

Suhail Sameer, CEO, BharatPe, said, “The initial response has been phenomenal. In the pilot phase, we have seen great traction with $5 million of monthly investment run rate and $1 million monthly borrowing run rate”.

With a Series E fund raise of $350 million, Bharat Pe has entered the coveted “unicorn” club at a valuation of $2.85 billion.