MobiKwik enters digital lending, to offer instant loan of up to Rs 60,000

The mobile wallet loan would be sanctioned within 90 seconds, claims the Delhi-based company

As the festive and wedding season approaches, mobile wallet start-up MobiKwik has launched a loan disbursal feature on its platform. Through this feature, users can get loans of up to Rs 60,000 in their e-wallet.

The mobile wallet loan, called "Boost", would be sanctioned within 90 seconds, claims the Delhi-based company. This loan can be utilised for purchases, marriage expenses, travel plans, hotel bookings, medical emergency, as well as payments to offline and online merchants. The company has tied up with four non-banking financial companies for the lending product. 

“We are using payments as a foundation to build India’s largest tech-oriented financial services company,” said Upasana Taku, co-founder and director, MobiKwik. “While mobile wallets continue to be our key business vertical, lending is a natural progression for us and fits in beautifully on top of payments,” she added.

The company’s move to enter the digital lending space comes close on the heels of the Supreme Court of India striking down Section 57 of the Aadhaar Act, which allowed fintech companies to ask for a customer’s biometric identification number for e-KYC verification. 

According to experts, without the e-KYC provision, the cost of acquiring new customers will shoot up significantly, in some cases by six times.

For MobiKwik, the users are required to update their KYC with PAN card to avail of the loan benefit. The loan sanction decision will be taken in 30 seconds, on the basis of a risk scoring model called 'Mobiscore', developed by the start-up. There are close to 500 variables that are used to analyse and generate a Mobiscore based on the customer’s spending patterns and other parameters that the app has access to. 

The loan amount is payable in six- and nine-month instalments. They can either payback from the MobiKwik app or can enable MobiKwik’s NBFC partner to auto-debit as equated monthly installment (EMI) from their bank accounts.

The company claimed that in the initial months of piloting the offering, it had crossed 100,000 customers. The company also has a few other products in the pipeline, including an SME loan product, which is expected to be launched around Diwali. 

MobiKwik, which is backed by global investors such as Sequoia Capital, American Express and Net1, boasts of over 100 million users for its mobile wallet service.