TapStart

Dec 15, 2020

Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by the organization it is based on. Don't you think life would have been easier if you had a personal line of credit at your disposal? Who doesn't want a hassle-free credit, where there are no formalities and paperwork? And the icing on the cake would be the money getting topped-up in your account as you keep paying back the borrowed amount. You are wrong if you think this isn't possible. MoneyTap, a Bangalore based startup has made this dream a reality. The company claims to be India’s first app-based personal line of credit for consumers. MoneyTap is India's first company that provides lifetime credit of up to Rs. 5 lakh instantly to its customers. MoneyTap - Company Highlights What is MoneyTap? Started by three serial entrepreneurs, Bala Parthasarathy, Kunal Verma, and Anuj Kacker, MoneyTap was incorporated in October 2015. It offers instant personal loans of up to Rs 5 Lakhs, with the entire KYC process happening through their mobile app. It is headquartered in Bangalore, India. The startup aims to deliver quick and flexible personal loans to individuals in partnership with banks—smoothly and efficiently. The MoneyTap app is a trustworthy and reliable one with many USPs. The app offers instant online loans through a 100% paperless process and doesn't require a bank visit. Moreover, one has to pay interest only on the amount borrowed. A loan taken through their app is collateral-free and has flexible loan tenures of 2-36 months. MoneyTap is India's first company that provides lifetime credit of up to Rs.5 lakh instantly to its customers. Getting loans from MoneyTap is super easy. Eligible candidates need to download the app and fill the KYC. After completion of the KYC formalities, the loan is approved and the customer is given a MoneyTap credit card that's loaded with the sanctioned amount. This can be used as a credit card or for withdrawing from the MoneyTap account. Once the repayments are done and there isn't further need for an account, one can easily close the account through their website or the app. To be Eligible for MoneyTap Loans, one needs to be between 23-55 years of age and should have a regular source of income. A person having as low as a minimum in-hand salary of Rs 15,000 per month can apply for loans on the platform. MoneyTap - Industry Details With the significant increase in internet users, almost every solution is now available online. Like all other services, financial services have also become accessible through apps and online services. Many Fintech companies are cropping up in the Indian market. According to a report published by NASSCOM, there are around 400 Fintech companies in India. The Approximate investment made in these companies is $420 million in 2015. The NASSCOM report also states that the fintech software and services market is expected to grow 1.7 times by 2020, making it worth $8 billion. The Indian government is also launching initiatives to develop Visakhapatnam (Vizag) as the 'fintech valley'. MoneyTap was founded by Bala Parthasarathy, Kunal Varma, and Anuj Kacker, who are IIT and ISB alumni. Bala Parthasarathy, Kunal Varma, Anuj Kacker - Founders, MoneyTap MoneyTap CEO, Bala Parthasarathy is the co-founder of multiple startups in Silicon Valley, including Snapfish (sold to Hewlett Packard). He has contributed immensely to the growth of Snapfish by gathering 100M users and $300M in revenue. Bala also volunteered for UIDAI under Mr. Nandan Nilekani in 2007. He started AngelPrime, an angel investment firm in 2011 (now Prime Venture Partners). While working with AngelPrime he helped shape companies like ZipDial (sold to Twitter), EZETap, Happay , etc. Kunal Varma is a serial entrepreneur, who founded Whimsia Custom Works, a company for customized merchandise, and Aspirare, which designs learning programs and assessment solutions for job seekers and college graduates. Kunal along with Anuj Kacker also co-founded Tapstart, a job discovery platform. Anuj Kacker is the COO of MoneyTap. Anuj has experience in diverse fields courtesy of working with established brands such as Airtel, Reliance, and JWT. He co-founded Tapstart which grew to 300K users and turned profitable within two years. Anuj exited Tapstart in 2015 to join MoneyTap. With a small office in Mumbai and the headquarters in Bengaluru, the MoneyTap workforce comprised of  30 people, as per 2019 data. MoneyTap - The Idea And Launch MoneyTap was founded keeping in mind the needs of the middle class. The salaried class is often constrained by monetary issues when it comes to satisfying needs. These needs can be anything like medical needs, school fees, or house rent. The trio observed that just a minimal amount of credit could help the middle class take care of these needs easily. But extensive paperwork and formalities make people apprehensive about taking loans unless it's a huge amount. Moreover, credit cards and personal loans are not very popular in India. Besides, the middle class also finds it humiliating to borrow money from family and friends. MoneyTap was the solution to this conflation of issues. MoneyTap - Name And Logo The name MoneyTap was chosen because the app allows users to get money simply at the tap of the finger. MoneyTap Logo How MoneyTap Works The MoneyTap app, launched in partnership with the RBL Bank and several NBFCs, issues collateral-free credit up to a limit of Rs 5 Lakhs. The founders added that consumers can borrow anywhere between Rs 3,000 and Rs 5 Lakhs from the app and choose from among several repayment options with regards to time ranging from 2 to 36 months. MoneyTap and RBL also launched the RBL MoneyTap credit card. The card can be used like any other credit card for making online and offline payments. Users can also transfer money from the MoneyTap app to their bank accounts directly. MoneyTap offers loans at an interest rate as low as 1.08% per month, and 13% to 18% per annum. Consumers have to pay a one-time setup fee of Rs 499 along with taxes which is payable to the banking partner directly for blocking the credit-limit. We are trying to get the middle-income group to use our application. For us, the sweet spot is someone who earns in the salary bracket of Rs 40,000 - 50,000 monthly. However, we also don’t mind it being lower. The founders also add that the money gets replenished as soon the customers start paying their EMIs. For example, an amount of Rs 30,000 borrowed (out of the credit limit of Rs 5 Lakh) will get replenished as the person pays their installments over time, thus becoming available for borrowing in the future. Further, on-boarding of customers happens through a chatbot interface wherein the system instantly connects to the banking system and the credit bureau to find out the credit history of the customer. The money then gets approved accordingly. MoneyTap - Business And Revenue Model MoneyTap adheres to strong business fundamentals since money lending requires attention to detail. The way it makes money is through a revenue share with banking partners. Every time a customer gets approved for access to a credit line for a lifetime, a small fee of Rs 500 is charged. Once the customer spends some money for one year, the money is recovered. Also, the usual interest paid by the customer along with the processing fees that are charged every time a person borrows also increases profitability. MoneyTap is designed to be a product company running on the backbone of data science, technology, and product thinking. It is also focused on low-cost, tech-friendly solutions to pave the way towards increased revenue. MoneyTap - Customer Acquisition MoneyTap was successful in building a large customer base within a short period. Within eight months of its inception, the company acquired 300,000 registered users from 14 cities in India. MoneyTap acquires some of its customers organically. The company also markets its products through Google, social media, and content marketing. According to Bala, there are a billion consumers in the country, and MoneyTap serves only 1% of them. He considers that even doubling this figure to 2% is a huge win. MoneyTap - Funding and Investors MoneyTap has raised $82.3 million in 2 rounds of funding to date. In the latest round, MoneyTap raised funding worth $70 Million (500 Crore) in January 2020. Here are the funding and investor details of MoneyTap. Date Some of the major challenges faced by MoneyTap are: Identifying trustworthy borrowers to whom credit can be disbursed without the fear of defaulting. Maintaining strong relations with banks and NBFCs. MoneyTap - Competitors Finomena is MoneyTap's #1 competitor. Finomena was founded in 2015 in New Delhi. Like MoneyTap, Finomena also operates in the consumer finance space. Other major rivals of MoneyTap are, PaySense and ZestMoney. Both of these companies, founded in 2015, function in the same segment. While PaySense is located in Mumbai, ZestMoney is located in Bangalore. Lizzie Chapman, Co-founder and CEO, ZestMoney; Rajiv Raj, Co-founder and Director, CreditVidya and Bala Parthasarathy, Co-founder and CEO, MoneyTap Besides, CreditVidya and New Delhi based Revfin also competes with MoneyTap. MoneyTap - Achievements MoneyTap has more than 5 Million downloads. However, this number isn't indicative of customers who hold a credit line, since the rejection rate from the pool of applicants can be as high as 60-70 percent. This high rejection rate is due to the rigorous checks done by the app's algorithms. Almost 90 percent of MoneyTap's customers who have been issued credit lines are active and have drawn credit multiple times through the app. The average lending size of the company is Rs 30,000–35,000 and the average age of the customer is 28–30 years. MoneyTap is currently operational in 60 Indian cities, with the majority of its users coming from the top metros like Delhi-NCR, Bengaluru, Mumbai, and Chennai. The company is planning to expand its footprints to 200 cities soon. MoneyTap also claims to have its non-performing assets well within the one percent mark. MoneyTap - Awards And Recognitions MoneyTap was awarded the ‘Best Innovative Lending Product/Service’ in the Payment & Fintech category at the 8th India Digital Awards. The award show was organized by the Internet and Mobile Association of India (IAMAI). MoneyTap was also awarded the leading FinTech Company in the lending category at PICUP Fintech 2017. MoneyTap - Acquisitions And Mergers MoneyTap is not actively looking for acquisitions. Bala tells that MoneyTap might acquire companies sharing similar values. MoneyTap - Partners MoneyTap launched its product with RBL Bank, its first banking partner. With the help of RBL's Technology, MoneyTap was able to serve customers with quick decisions and quick access to the money round the clock. Moreover, RBL Bank also provides a MoneyTap-RBL Credit Card with the credit line. In 2017, MoneyTap announced a partnership with Aditya Birla Finance Limited (ABFL). MoneyTap also has several other banks and NBFCs as partners. On December 2020, MoneyTap announced its partnership with Pawtect with a view to offer Pet Insurance Policies to their employees MoneyTap - Future Plans MoneyTap's plans include: It is looking to expand to more Tier II and III cities in India, and to global markets with South East Asia and the Middle East. The company currently claims to have a loan book of 1000 crores and aims to make it 5000 crores by 2021. Expanding services to 200 cities in India. Building partnerships with more banks. The company currently targets customers in the age group 29-31, with average incomes of INR 30,000- INR 40,000 per month, but is planning to reach out to groups having income as low as Rs 10000-15000 soon. MoneyTap has also received NBFC license in September 2019 and plans to launch its own NBFC company soon. MoneyTap - FAQs Who are the Founders of MoneyTap? MoneyTap was founded by Bala Parthasarathy, Kunal Varma, and Anuj Kacker, who are IIT and ISB alumni. How much is MoneyTap Funding? MoneyTap has raised $82.3 million in 2 rounds of funding. In the latest round, MoneyTap raised funding worth $70 Million (500 Crore) in January 2020. Who are the investors of MoneyTap? Sequoia Capital India, RTP Global, Prime Venture Partners, Aquiline Technology Growth & MegaDelta Capital, New Enterprise Associates.