Have you had your eye on this one expensive gadget for months now? Does anybody with the smart swag of flicking out that new smart phone give you the shade of Grinch in envy? But what is keeping you from buying that expensive gadget that is available in the markets?
Well, the answer needs no major explanation, if you are a college student or just a young earner with a modest salary and too many financial obligations to pay for, then it is understandable that you simply do not have the money to spare for such an expensive purchase. The former group does not have enough in their pockets and the latter just don’t have ample savings after paying up all their bills.
So, many see the option of EMIs a seemingly good enough solution. But the fact behind EMIs is not always as easy as it may seem. Because such bank loans come with their own set of requirements, and those at retail stores with EMI schemes need a credit card and only come with a limited amount of inventory to choose from.
But all these problems synonymous with mediocre living of the working class may soon disappear with the start-up called Finomena which is based in Bangalore. This has a unique loan verification system and offers approval fast with an alternative route.
The company can be described as a customer-experience based fintech sort of system that offers financial solutions with an inclusive approach, thereby offering easy credit options to people who have never taken credit before. So, these people usually do not have a credit score so to speak. It is also very easy to use, as one can register online and then browse through e-commerce sites and then select the desired gadget from the site and choose the EMI or other financing option and apply it within the time taken for a mouse-click.
There are flexible EMI options available for purchasing different gadgets with Finomena.
Having a bank account is not enough:
With the phrase financial inclusive it seems to evoke the feeling of including a section of the population who do not have access to basic banking services. That is why even the government’s move has been to help people open a basic bank account with the financial inclusion scheme of Pradhan Mantri Jan Dhan Yojana. But simply having a bank account does not allow access to credit to people. A large section of the masses are left out from acquiring credit are people who despite having a bank account cannot get access to credit as they are either students, self employed or are young professional with modest income.
As per reports almost 75% of Indian does not even have a proper traditional Credit Bureau Score. A company representative suggested that they cannot rely on traditional credit score assessment options as this section of the population do not have such data about them. However, even if they do not have a proof of income with power of smart technologies like a smart phone they are leaving behind a footprint of digital data about them. So, this platform takes the step ahead with big data based machine learning driven assessment and credit risk modeling which will assess more than 20,000 data points to identify the credit worthiness of a person.
What is a credit score?
The all important credit score is a simple three digit number assigned to people by the Credit Information Report that will eventually give the banks idea of credit worthiness of an individual. The number ranges between 300 to 900 and usually a score 750 is thought to be best for the banks. But a major problem with this system is that usually young people do not have a credit score at all. And hence, get lost in the cycle of being denied of credit over and over again.
In store EMIs come with a lot of hassles and hidden clauses and the clients of Finomena have acknowledge that their system is fairly simple, transparent and easy to access for the young earners and those with self-employment. This group also includes litigation lawyers and young private medical practitioners. The EMI breaks up of costs are pocket-friendly and they also let people choose the down payment amount.
The company revealed that they aim to approve loans within 30 minutes for offline system and within 24 to 48 hours online. People can choose for the paperless option as well and go online to upload their necessary documents. Once the company receives the necessary documents of proof of address and bank statement, their machine learning algorithms get to work immediately.
Soon with such platforms emerging, the way people purchase gadgets will be revolutionized with a 3-minute application, 1 day approval and 2 day delivery of products.