The Inception of InCred: Addressing a Critical Need
Despite growing aspirations, access to credit remained limited for individuals and small businesses due to stringent traditional lending criteria.
Identifying the Problem
In India, financial inclusion was a buzzword, yet millions remained underserved. Bhupinder realized that the conventional credit system relied heavily on collateral and complex processes, excluding a large segment of borrowers. He envisioned a platform that could leverage technology to underwrite loans based on alternative data, making credit accessible to a wider audience.
The Birth of the Idea
Bhupinder’s idea was simple yet groundbreaking: Their own data analyses, and artificial intelligence methods, and to design a lending platform that can learn and interpret credit applicants of commercial banks in a better way as compared with traditional banks. This approach would enable the delivery of customized loans while minimizing risk.
Building the Prototype: A Data-Driven Fintech Platform
Focus on Innovation
The next step to enable InCred was to establish the base of a user-driven lending platform. The prototype focused on:
- Personal Loans: Tailored for individuals with varied credit profiles.
- Education Loans: Enabling students to pursue higher education without financial barriers.
- SME Loans: Helping small businesses grow with quick and accessible funding.
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Tech-First Approach
In contrast to conventional financial intermediaries, InCred technology has served as the foundation of its business operations. The platform utilized a combination of AI, machine learning, and data analytics to assess creditworthiness. This innovative approach allowed InCred to provide personalized loans without the intrusive automating bureaucratic procedures.
Empowering Underserved Segments
InCred also gave higher priority to the borrowers from tier-2 and tier-3 cities for whom due to the absence of the credit history, loan securing often remained difficult. Using alternative data sets (i.e., utility bills, social media activity, expense receipt) to provide credit to these unbanked communities, InCred opened credit to these underserved populations.
Overcoming Challenges: Paving the Road to Success
Breaking the Trust Barrier
InCred’s tech-driven model was initially met with skepticism. Creating incentives for borrowers to access a platform featuring digital services, and encouraging the provision of credit scoring models that go beyond the conventional ones, was one of the main difficulties. The company invested in training stakeholders in the transparent and effective way in which the company has practiced, and gradually garnered credibility.
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Competition in the Fintech Space
The Indian fintech market was already a saturated market with "Big Players" such as Bajaj Finserv and "New Age" players such as Lendingkart and Capital Float. InCred stood out by fusing advanced technology with a sense of humanity in providing complete customer support along with digital ease.
Regulatory Hurdles
Navigating India’s regulatory environment was another challenge. InCred has consistently adhered to RBI guidelines during discussions relating to policy to encourage digital lending innovation.
Key Milestones on InCred’s Journey
Funding Success
From its inception, InCred attracted significant investor interest. Backed by star investors such as Anshu Jain (ex-co-CEO of Deutsche Bank) and companies like FMO, Investcorp, and Alpha Capital, it raised over 200 million dollars in funding.
Diversification of Services
Initially targeting personal loans, InCred further extended its scope to cover the areas of education loans, SME financing and wealth management services. This diversification played a crucial role in its growth trajectory.
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Achieving Unicorn Status
In 2021, InCred achieved unicorn status and established itself as one of India's largest fintech companies. This milestone was exemplification of its innovative spirit, its proven business model, and its focus on customer success.
Unveiling Lesser-Known Stories About InCred
The Role of Bhupinder Singh’s Vision
Bhupinder Singh's personal experience became the most important driving force behind the identity of InCred. He was profoundly moved by seeing firsthand the limitations of conventional systems to meet the needs of the diverse, and so desired to develop a more universal, inclusive platform. By doing so, his global career in structured finance made his company InCred a data-driven lender.
Focus on Education Loans
Bhupinder is not unfamiliar with saying in an interview that his enthusiasm for learning drove InCred's interest in Education loans. He also believed that there is no end to a student's dream no matter what financial restrictions there are, a principle with which the mission of InCred is perfectly compatible.
Culture of Customer-Centricity
InCred’s internal culture emphasizes putting the customer first. The company has systematic feedback meetings with borrowers to constantly adjust its offerings. For this reason the focus on customer satisfaction has been one of the driving forces of its impressive growth.
Sustainability Goals
InCred is also committed to sustainable growth. Digitizing processes, the company has also reduced to a bare minimum the amount of paper involved, which has positive environmental impacts.
What Sets InCred Apart?
- Tech-Powered Lending: InCred's use of AI and data analytics has allowed for faster, more precise credit scoring.
- Focus on Financial Inclusion: The company’s innovative approach makes credit accessible to individuals and businesses often overlooked by traditional banks.
- Personalized Solutions: InCred provides customized loan solutions so that each customer can get a solution that is appropriate to their needs.
- Commitment to Education: InCred's student loans have enabled a very large number of students to realize their aspirations, helping to develop India's knowledge based economy.
Lessons from InCred’s Success Story
- Address Real-World Problems: InCred’s success lies in its ability to solve a critical issue—lack of accessible credit.
- Leverage Technology: The depth with which the company is using technology has changed lending cycle.
- Focus on the Underserved: By pursuing financial inclusion, InCred unlocked a rich and unserved market.
- Adapt and Evolve: This InCred service diversification illustrates the utility of market responsiveness.
The Road Ahead for InCred
InCred's evolution from a small company to a unicorn is a manifestation of vision, innovation, and endurance. As it continues to grow, the company is poised to further disrupt India’s financial ecosystem. Expansion of its digital presence, improved AI functions, and development of new financial products to meet changing customer demands are future plans.
Conclusion
InCred's growth is not just a commercial success, but also a story of impact. In India, with a novel reinterpretation of lending, the company has upgraded the hopes of everyday folks, aided enterprises, and added to the GDP of India. For aspiring entrepreneurs and fintechers, the journey with InCred is one for inspiration and example on tenacity, ingenuity, and customer focus.
Final Thoughts
Consistent with InCred's view to the future, InCred's vision of financial inclusion and innovation is strong. It is the story, however, that hopefully provides motivation for transforming everyday business (and the world) ethically.