Alibaba-backed Paytm has invested in two-wheeler focused online lending platform Creditmate. While the funding remain undisclosed, the fin-tech major acquired a majority stake in the mumbai-based startup.
Following the deal, Paytm will leverage CreditMate’s proprietary credit and asset valuation technology and loan management system.
Founded in 2016 by Ashish Doshi, Jonathan Bill and Aditya Singh, Creditmate focuses on enabling its dealer partners to distribute two-wheeler loans to customers with no formal credit history.
Importantly, it also helps two-wheeler owners to secure a loan against their bike.
The investment comes within a week of Paytm’s debut into lending space. The company launched an interest-free short-term loan product – Paytm-ICICI Bank Postpaid last week. Customers can access instant loans in the range of Rs 3,000 to Rs 10,000 for bill payments, flight and movie tickets, recharge among several other use cases.
“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,” said Madhur Deora, Senior Vice-President and Chief Financial Officer of Paytm in a press statement.
CreditMate works with banking, financial services companies and Non-banking Financial Companies (NBFC) such as Optimus Finance Limited and KJMC Financial Services Limited.
The startup provides a credit recommendation and online access to a complete digital borrower and asset profile to enable fast and secured lending.
InOctober last year, Creditmate secured $500,000 in a seed round from early-stage investment firm India Quotient.
“We are delighted to welcome Paytm as an investor given the strong synergies in our vision. This will allow us to expand our operations, distribution, lending partnerships and technology investment to help a wider set of consumers to access and leverage this key life-enhancing asset is. Achieving this is both economically and emotionally rewarding for us,” said Bill, Co-Founder and CEO of CreditMate.