Reliance Capital invest Rs 7 cr in ex-Infosys director's BillionLoans

BillionPlus, a fintech startup, makes it easier for SMEs to borrow by connecting them to lenders

Reliance Corporate Advisory Services Limited, a unit Reliance Capital has invested Rs 7 crore or about $1 million in BillionLoans Financial Services, a firm founded by former Infosys board member V Balakrishnan.

The financial technology (fintech) startup looks to make borrowing easy for small businesses and individuals by connecting borrowers to lenders via technology and data based credit analysis. The focus is to build a credible 360 degree credit profile of borrowers based on their banking history and social graph so as to minimise risk for lenders.

Balakrishnan co-founded BillionLoans with Dr Rangan Varadan, founder of micro lending platform MicroGraam.

"We are integrating diverse data analytic techniques like psychometric analysis and big data, along with user experience focused design to make this happen. We will leverage MicroGraam's model of building a grassroots partner organization to connect borrowers and lenders," said Dr Varadan in a statement.

Billionloans will initially focus on loans to SMEs, affordable housing loans, education loans and personal loans. To facilitate loans, the company has tie ups with reputed financial institutions and banks to its technology platform.

"Technology and innovation in financial services are going to play a big part in bridging the gap between aspirations of large number of Indians wanting access to credit on one hand and the ability of companies to build efficient and scalable lending models on the other. We look forward to support Billionloans in their vision and partner in their growth," Anmol Ambani, Executive Director, Reliance Capital Ltd, said.

In the next three years, the company plans to facilitate around Rs. 2,000 crores of loans across multiple products and lenders

"India has a large pool of unbanked population. Technology is going to be a big enabler in addressing this core issue. This will lead to a dramatic change in access, both for borrowers with thin credit histories and for lenders looking to expand beyond their traditional customer bases. The investment from Reliance Capital is a great validation of our business model, " said Balakrishnan

As it becomes harder for small businesses to avail loans through banks due to the large non-performing asset burden of these institutions, technology enabled financial institutions (fintech) are grabbing the opportunity. Several fintech firms such as LendingKart, Capital Float are looking at offering loans and tap opportunities to serve businesses and individual customers.