Chinese electronics giant Xiaomi has entered the consumer lending market in India with Mi Credit. Available on both Google App Store and Xiaomi’s GetApps, Mi Credit is a curated marketplace for lending, which means the company will partner with multiple lending companies to offer personal loans.
Announcing the partnerships on Tuesday (December 3), Xiaomi says it has partnered with Aditya Birla Finance, ZestMoney, EarlySalary, Money View and CreditVidya for the lending service. Mi Credit will be offering loans up to INR 1 Lakh at interest rates starting from 1.35% per month, for the tenure of three to 12 months.
Talking about why it has adopted a marketplace model, Manu Kumar Jain, Global VP of Xiaomi said that this helps Xiaomi achieve a high success rate, bigger loan amounts and better interest rates.
Mi Credit was launched as a beta in India in August. According to Jain, during the pilot phase, Xiaomi was able to serve 1.5K pin codes across 10 Indian states including Maharashtra and Karnataka. As of November 2019, the company disbursed INR 28 Cr. worth of loans.
Mi Credit is using paperless KYC (know your customer) for customer onboarding and allows repayments through e-mandates. Commenting on the data privacy concerns, Jain said, “We have data protection agreement with partners and all of MI’s data is saved in encrypted format at data centres based in india.”
Xiaomi Deepening Focus On India
Xiaomi had started operations in India four years back. In August, Jain had said that the brand accounts for 50% of all online smartphone sales in India.
With India’s smartphone users projected to reach 829 Mn by 2022 and digital lending being pegged as a $1 Tn opportunity, Xiaomi’s deepening focus on the Indian market seems justified. Other prominent players in the digital lending space include Paytm Money, Capital Float, Kissht, LendingKart, Faircent and more.
As a part of the company’s efforts to capitalise the Indian market, Xiaomi has also been supportive of Indian government’s policy initiatives such as Startup India and data localisation.
Recently in March, Xiaomi has entered the payments space in India with the launch of its Unified Payments Interface (UPI)-based payments application Mi Pay, which too is only available for Xiaomi users.
Correction Note | 15:09, Dec 3, 2019
The article was corrected to reflect that Mi Credit is available for all android phone users and not just Xiaomi phone owners.