Is Indian Market ready for Peer-to-Peer lending business?

ResearchNXT is here in conversation with Karun Thareja, CMO,, India’s largest peer-to-peer lending platform. Managing businesses related to Information Technology has been a special focus in his career, and so his insight on how the unique offering of Faircent is leveraging the power of marketing automation, makes for some interesting reading:

Business model of Faircent is something which is new to the Indian market. Please tell us more about the company and your Journey along with its growth.

Karun: Faircent is a FinTech innovator. We are basically a part of the financial technology disruption which is happening in the country today. What we are trying to do is to create a P2P (Peer to peer) lending industry. Fundamentally we are providing an alternative to banking and other financial institutions.

We match people who need money to people who have surplus money to invest. So you can come to Faircent to apply for a loan and also to invest in loans. Investors whom we call lenders can get returns up to 18% to 20% per annum which is much better than other options today. As a borrower you can avail unsecured loans at much cheaper interest rates. What we feel is that the banks make huge margins in terms of the rates that they offering customers on their savings and the rates they are lending it out to people at, in the form of loans. By reducing the margin, with Faircent as the match maker, we are able to pass value to both sides of the table, to borrowers as well as lenders.

We have been in operation from the last 2.5 years. Today there are 15k people applying for a loan every month on our website and we have 1k people who want to give money as loans to people to make better returns registering as lenders every month.

Where all have you implemented technology at present from a marketing stand point?

Karun: We are purely a digital entity.   We are trying to use technology so that there is minimal offline intervention. As a pioneer, we built a platform which did not exist. So we had to build a platform which enables match making between the loan seeker and lender, from scratch. As a result of this all our marketing interventions or marketing technology interventions are tied to our platform.

How we go and choose the various different marketing technologies for implementation is important for us and we put on a lot of effort behind evaluating the options because the effort in terms of implementation is high for us as compared to what it would to implement these with a standardised core platform.

We’ve done a lot of marketing technology interventions, like we have a CRM which is built on top of our platform, which is a custom made CRM. We have integrated it with our lead gen channels. We have an email marketing platform using which we nurture our customers and also do promotional activities with potential customers. We have done a lot of work in trying to become Omni-channel. Three main channels which we use are email, SMS and Voice.

Consequently, going into the future, we’re looking at how we can look at chat bots to service our customers and will look at getting psychometric data for our customers, in order to assess whether they can be given a loan or not.

“Marketing Technology has reduced our Cost Per Lead (CPL) to almost 1/10th”

For marketing technology are you using any of the off- the-self products as well or you are a strong believer on building it up yourself? Which are the products that you are using?

Karun: I think it’s not about having an edge but more that it’s a requirement now. I have a background in IT wherein I’ve worked with companies like Microsoft and IBM and what I’ve seen in my past experience is that CIOs don’t have the ability to understand MarTech. They are good at what they do but this is an area where there is a lot of stuff happening and it’s very difficult for them to keep track of what is happening. So they do need that input from marketing and when you’re talking to a CIO you have to talk technology, otherwise they will not understand what you’re saying. They will always tend to look at it from the technological perspective.

 You have mentioned that you are using a mix of off-the-shelf and in-house built products. Did you ever evaluate a complete suite of marketing automation solution which is available in the market which could do all that you are doing by integrating multiple products?

Karun: Mostly it’s got to do with where your organization is. So obviously in order to take advantage of all the progress which is being made in the marketing technology sphere you need to be a more open and you can be more open if your core system is an off the shelf, standard product. But for us the key thing was that since we are a pioneer digital P2P lender, we had to build our core platform from scratch and to take advantage of marketing technology we have custom-integrated with a bunch of off the shelf products. It makes sense to develop what is core for you as an organization but you should take advantage of these off the shelf products as well.

“CIOs are good at what they do but they don’t have the ability to understand MarTech.”

From a future perspective are you planning to invest more into mobile apps?

Karun: Yes, we have a mobile app which is available on the Android and iOS platform. Right now, our focus has been more to enable our customers to access our platform on the mobile device. So for example if there is an investor who wants to invest in loans on the fly he can do it using our app. At present we’re not really focused on the app to acquire more borrowers or acquire more investors and lenders. In the future, we surely will run app install campaigns as well.

Is your product more focused on India as a market and does that require a lot of customization versus building a product which is for a different geography?

Karun: Our product is actually built for the Indian Market. We are basically in the financial services space and there are a lot of regulations, legal structure which we need to be aware about and we need to be compliant with to be able to do our financial services business in India. The Indian financial market is very different from the rest of the world. You could sell a loan to somebody else in other countries, which is not really allowed here in India at the moment.   This is the reason why we had to build a platform from scratch based on the Indian process framework.

From all the marketing initiatives which are channels from where you are getting you maximum in-bound leads?

Karun: Over the past quarter we have been focusing on “Social” a whole lot and whatever effort we are putting in that is giving us great returns. So, that is a key piece of our strategy. Facebook is giving us a lot of visibility, because of which a lot of people are coming on to our platform and registering and asking for loans. We have also integrated it now with our platform in real time where customers can get a call within a couple of minutes on his/her coming on to our platform and registering. Currently ‘Social’ is bigger than ‘Search’ for us.

“The Indian financial market is very different from the rest of the world. This is the reason why we had to build a platform from scratch based on Indian regulations.”

What is you advise to somebody who is evaluating marketing technology?

Karun: I would say, whatever you are doing, ensure that you are measuring it. You should measure it in terms of impact and effort. We have a saying in Faircent that it’s good to fail but fail fast. If your measurements are not in place, then you will be putting up more resource than what is required. Today with the technology which is available it is not difficult to get metrics in place. I would like to tell marketers to experiment a lot. At our level there are 6-7 experiments going on in a day. We are constantly trying new things. With metrics in place you will know what is working and what isn’t for you.

What are your expectations from the B2C Marketing Automation Report: Indian, 2017?

Karun: With this report I expect that my knowledge about marketing technology tools will get expanded. I would like to know more about the tools which are available in Indian market. And it will be good if you can break down the MAS features. This will help in understanding which tool is suitable for which platform.