The Indian Electric Vehicle (EV) ecosystem has been witnessing a growing acceptance among the masses. The ecosystem, which was valued at $5 Bn in 2020, is expected to evolve into a $47 Bn market by 2026.
Amid the expected boom, supportive policy environment, improving economics, and emerging business models, the EV ecosystem also faces certain barriers. Major bottlenecks include technology cost, infrastructure availability, consumer purchase behaviour and finance availability.
Incepted in 2018 by Sameer Aggarwal, RevFin, a digital consumer lending platform, enables financing of commercial EV (3W) loans in Tier 3 and Tier 4 towns, considering that EVs were in huge demand yet highly-priced.
The startup has raised $4 Mn (about INR 30 Cr) in pre-series A funding round with both equity and debt.
Led by Dheeraj Jain (Redcliffe Life Solutions), the round also saw participation from Let’s Venture Angel Fund, Anuraag and Ruchirans Jaipuria, Rishi Kajaria and Rahul Seth, Amit Goel (Knam Marketing), and Ranjit Yadav (CarDekho).
The startup plans to use the funds raised to accelerate the adoption of EV solutions among low-income consumers in the country. RevFin also intends to expand its operations by increasing loans from the current monthly disbursement run-rate of INR 3 Cr to INR 15 Cr.
Loans Provided Less Based On Credit Score, More On Intention Score
In an interaction with Inc42, Aggarwal previously underlined that the average customer for RevFin is either not very literate or has limited education. Thus, they are excluded by banks and lenders.
The audience primarily hails from Tier 3, 4 towns and 85% of them have never taken a loan in the past, the founder said. Thus, there is hardly any credit history or CIBIL score available for these customers. But nevertheless, they have bank accounts, even if it’s dormant or not heavily used.
RevFin claims to rely less on numbers, and more on a psychometric and biometric assessment. The startup aims at financial inclusion among the underserved through honesty, intention and biometric test.
RevFin serves the EV consumer segment pan India with major operations across UP, Bihar, Haryana, Punjab, Rajasthan, Delhi, Jharkhand, Madhya Pradesh and West Bengal. The Delhi NCR-based digital lending platform further aims to fund over 80,000 electric vehicles in the coming 3 years amid the increased use of EVs among the delivery fleet of ecommerce companies.
Digital lending is one of the fastest-growing segments in India’s fintech space. A BCG report has predicted the digital lending industry will touch a market size of $1 Tn in the next five years.
Some of the Indian players in the space include Paytm, LendingKart, Capital Float, MoneyTap, MoneyView, MobiKwik, ETMoney and Avail Finance, and others. Most of the consumer lending companies are single-segment focussed or provide use-case of loans.
Digital payments companies such as Paytm and MobiKwik are attempting at becoming digital credit cards for all customers. These companies also have the advantage of having access to users’ transaction history and monthly payments, which helps them in underwriting customers who might not have a credit history.
RevFin, on the other hand, claims to be the sole player in the category for the early wave of commercial EV customers in Tier 3 and beyond.