PayU and Kreditech enter beta phase for new PayU Moneda product.
Fintech firms PayU and Kreditech have launched a beta version of a new product to finance online consumer purchases in India. The product, named PayU Monedo, will provide cardless EMIs (equated monthly instalments) to online shoppers.
It aims to fill a credit gap for the banked and underbanked population in India with short and medium term shopping credits, available at checkout on popular e-commerce websites.
Hamburg-based Kreditech uses machine learning to deliver real-time underwriting, and its lending-as-a-service platform Monedo powers the new proposition. The cardless EMI will be offered as a payment method at checkout. The plan is to approve customers for credit in under two minutes at rates comparable to local banks, with both duration and interest rates varying based on Kreditech’s assessment of a customer’s creditworthiness. Consumers can choose from various repayment options. The loans will range up to $2k in size.
PayU is a payment service provider with over 300,000 merchant customers to its name. It invested a massive €110m in Kreditech in May 2017. The German platform’s lending-as-a-service product was said to be key to the investment.
The two firms believe their new product will enable merchants to tap into completely new market segments, increasing sales and lowering cart abandonment rates.
“At Kreditech, we have developed a proprietary credit scoring technology which uses artificial intelligence and machine learning to assess an applicant’s creditworthiness in seconds and with higher precision than traditional credit-bureau based systems,” said Alexander Graubner-Müller, CEO of Kreditech.
“By teaming up with PayU, we are going to offer attractive loans to individual consumers with flexible terms of repayment. This is the first partnership between a payment provider and an alternative lending company and we are thrilled to have kicked-off our joint business in India. We are bullish about our foray in India and will be setting up an office in Mumbai.”