Monish Anand has over 20 years of experience in both technology and banking (working with finance and tech majors such as Citigroup, Standard Chartered Bank, Infosys and British Telecom), leading him to create a viable solution for the urban financial crisis of Indian professionals. He has launched Shubh Loans to make the process of acquiring loans more transparent and simple for the working class population.
Shubh Loans is a vernacular app that helps salaried employees (with an average monthly income starting at INR 12,000) in getting a loan of up to Rs 5 Lakhs with a reasonably long-term (up to 4 years) EMI tenure. Their smart credit model deviates from the traditional loan model (where the individual's repayment capacity is the sole criteria) and replaces it with the “Shubh Loans credit model” (which analyzes repayment capacity as well as intention-to-pay of an individual).
While the traditional credit scoring system, reliant on CIBIL, keeps 80% of India's populace from getting loans - Shubh Loans helps applicants understand their credit score and standing in a holistic manner, and leads them towards better financial decisions.
This is an exclusive interview with Monish, as a part of The Times Blog - Stories initiative.
When did you decide to launch Shubh Loans, and what are your plans for the Indian finance ecosystem with it?
Unfortunately, although India is one of the largest markets for consumer finance, it also the most under-served. According to the international philanthropic investment firm Omidyar Network, more than 400 million people borrowed money in India in 2014, but less than one out of every seven were able to secure a formal loan. The fact that our loan-to-GDP ratio is only 16%-17% means that credit remains elusive for a majority of our population.
With a fervent lack of formal lending to the blue/gray collar segment, the informal channel is flourishing. The interest rates in the black loans market start from 4-5% a month, and skyrocket thereon. The perils of borrowing from such channels are harrowing. From debit cards being held as collateral to physical/mental harassment from moneylenders, the borrowers get thrown into a spiral from which they can never recover.
Datasigns (the parent organization) is solving a fundamental problem that can help more 350 million people and bring them under the formal banking & lending umbrella. Datasigns (through its mobile app "Shubh Loans") is harnessing the power of a billion mobile phones to let individuals not only access optimal credit, but also become aware of their credit standing.
By offering individual credit reports in regional languages, Datasigns is on a mission to demystify "credit" for rural India, and to make millions of people financially literate.
Some of the challenges that we faced initially were building the initial credit model, building digital trust with our target customer base (rural India, late adopters) and of course - in pushing to close the overall gap between digital lending, and digital literacy.
How did your family react when you told them you wanted to run your own business?
They have always been supportive of me pursuing my interests and my passion. With Shubh Loans becoming a major game changer in the sector of financial inclusion, their support has only strengthened with time.
How did you find your audience for Shubh Loans?
In a line, this is simple. Everyone wants credit.
Theoretically speaking, access to credit is essential for every individual. But with a deep lack of formal (read: bank-led) lending to the blue/gray collar segment, the informal channel just wins by default. Finding unregistered borrowers is a challenge, and we are currently using digital, offline and strategic partnerships as a means to acquire these customers. We are also constantly experimenting to find new and innovative ways of reaching out to our customer base.
Was there ever a time when you felt overwhelmed with your business and unable to continue? What made you continue? What kept you motivated at your worst moments?
It is common to feel demotivated. In my case, these three things have kept me motivated:
- The company’s purpose
- My family's trust in me
- My team's energy (at Shubh Loans)
Sometimes, the simple act of motivating others can also serve as a valid channel to reignite your own motivation.
Who are you most influenced by, and what is your takeaway from their words/actions?
That has got to be Jeff Bezos.
Bezos once said, "The common question that gets asked in business is, 'why?' That's a good question, but an equally valid question is, 'why not?'"
It is this "Why not?" persepctive that pretty much sums up my entrepreneurial journey.
What are the Top 3 Business Takeaways that you did not know when you first started out?
1. Build a great team
2. Generate revenue from day one
3. Obsess over customer experience
Have you raised funds for your business? Please share any details that you feel comfortable sharing.
We have raised pre-series A funding of $1.6 million in 2017, and we are currently in the process of raising Series-A round of funding.
Any advice to aspiring startup founders and entrepreneurs who want to make it big in healthcare and wellness?
Please keep your eyes and ears open. Don’t be afraid to get your hands dirty in understanding the problems of people. This is the only way in which you can expose yourself to the unbiased thoughts and opinions of your target audience. Also, always know your strengths and and play to them.
Is there anyone you want to thank?
I have to thank all my friends, family and employees who have helped Shubh Loans in its journey!
Is there a product or service that you wished existed today, to help realize your business goals faster?
Sure - I'd love some tech that can enable us in reaching our TG faster and efficiently. In addition, an overall ecosystem that can establish trust between lenders and borrowers in a faster and more effective manner.
Having said that, I’d also like to point out that it is partly these very challenges that give us a reason to exist!
The Times RapidFire
Name One book that you would recommend today, without blinking.
Answer: Predictably Irrational - By Dan Ariely
An original quote for your loyal customers?
“ Thank you for trusting Shubh Loans as your financial partner!”
Do you operate with goals, or systems? Pick one.
Answer: You need bit of both. Without goals there won't be any systems, and without a system you cannot achieve your goals..
Cricket, or no Cricket?
Print, or Digital?
And finally... what comes to your mind when you hear the word ‘The Times Blog’?