Paytm has acquired an undisclosed stake in CreditMate, a Mumbai-based startup which operates in the online lending space. The startup focuses on enabling its dealer partners to distribute two-wheeler loans to customers who has no formal credit history.
With this investment, Paytm will leverage CreditMate’s proprietary credit and asset valuation technology to create a loan management system in collaboration with its lending partner for its customers.
The latest investment seems like a part of Paytm’s efforts to create consumer credit products, and is likely a move towards offering longer tenure loans of large ticket sizes.
This comes just a week after Paytm announced its own lending product, Paytm Postpaid, in partnership with ICICI Bank. It aims to enable access to instant credit for its customers for everyday commerce use-cases, ranging from movies to bill payments, flights to physical goods.
Commenting on this development, Madhur Deora, Senior Vice-President and Chief Financial Officer of Paytm, said,
Top one percent of the consumers in our country have access to a wide variety of credit-related products, whereas the remaining have limited or no access. Paytm intends to change the course of the Indian financial ecosystem by enabling hundreds of millions of deserving consumers to avail long-term credit based on a proprietary loan management system that will cover small scale entrepreneurs and self-employed individuals.
The company reveals that about 65% of CreditMate customers are already Paytm users, which highlights unique opportunities for expanding availability of credit. Over time, the company is hoping to make credit available both offline and online.
CreditMate believes that it will be a valuable and long-term partner towards Paytm’s effort to cater to the unorganised sector and bring inclusive financial services for the masses.
The Mumbai-based startup was founded in April 2016 by Ashish Doshi, Jonathan Bill and Aditya Singh. It focuses on financing the used two-wheeler market.