Online lending marketplace Namaste Credit today said that it is launching its Neobanking solutions for MSMEs, becoming a full-fledged "Digital-Only Bank" with a foundational SaaS play.
As a Neobank, Namaste Credit aims to become the first Neobank to offer a one-stop financial services provider for MSMEs, offering automated credit, banking and accounting solutions.
Namaste Credit Neobank will offer numerous tailor-made products via a soon-to-be-launched “Namaste Biz” app to address multiple, inter-related financial needs of MSMEs, including centralizing their cash flow and banking and credit management.
“We believe a technology-based integrated platform that can bring together banks, NBFCs and other stakeholders can completely transform the financial services industry, specially from a B2B perspective. As a Neobank, we are confident to achieve precisely that, which will ultimately put us in a unique position to serve the MSME banking needs end-to-end, and at lower costs,” says Lucas Bianchi, the co-founder and Director of Namaste Credit.
India has over 50 large banks and NBFCs, who use over 100,000 Direct Selling Agents (DSAs) and offline channels to reach the over 30 million MSMEs in India.
“Our transition to a Neobank will not only help the startup get a firmer grip into the Banking & NBFC ecosystem but also balance revenues with customer acquisition costs to maintain a profitable growth path,” Mr. Bianchi added.
Namaste Credit said it is growing 20% month-on-month in the SME credit segment, as more financial institutions are adopting the technology and automation path. In less than 18 months, the startup has emerged as the largest SaaS automation provider for comprehensive credit underwriting for India's Financial Institutions.
The startup is leveraging its proprietary technology powered by AI, NLP and computer vision in SME credit application sourcing and processing, to solve real-world problems of SME credit.
Gaurav Anand, co-founder and director, Namaste Credit says, "This transition will help our partner Financial Institutions to get real-time insights into their lending customers, underwrite better and cross-sell other products. Cross-selling takes time, and if the revenue model is based on cross-sell commissions and SaaS fee from SMEs, it can take a long time to break-even. We saw this across many Neobanks globally and are looking to solve this problem by overlaying our Neobank over an existing business, which will allow us to be profitable from the start".
“This innovation in business model will create a substantial competitive advantage for us in three key aspects: accelerate customer and channel acquisition, reduce operational costs significantly, and finally, allow us to expand quickly to global markets,” Mr. Anand added.
Namaste Credit raised $3.8 million in Series-A funding led by Nexus Venture Partners in 2018. It also plans to grow the number of its technology licensing partnerships with leading lenders across the globe.