When COVID-19 struck, most of the world’s economy came to a standstill. This made lending money to companies and individuals a risky process. Not being able to determine the nature of its clients, many banks and fintech companies were stuck in a dilemma.
It was at this time, Nageen Kommu realized the importance of having a company which would do background and financial checks on its clients in order to make a decision to lend or not.
Set up in 2019, Digitap.AI is a fintech platform that offers credit underwriting and digital customer onboarding solutions to banking, financial services, and insurance enterprises. The company specializes in two particular verticals: digital customer onboarding and individual scoring model.
The key service offered by the company is its scoring model; it enables its clients in building customized scoring models that will help in its customer segment.
The main aim of such a scoring model is to assist businesses to improve risk management and to reduce fraud. The platform’s onboarding options consist of KYC solutions, Optical Character Recognition and document validation, and an RBI-compliant video KYC solution are some of them.
Explaining its scoring model, Kommu founder and CEO told Entrackr, “We are currently predominantly focused on individuals as our customer segment. What we are looking at is, what data can we gather about these individuals which will help my clients who are predominantly companies in the BFSI sector, to know more about these customers, and help them to take a decision on whether they should provide credit to these customers or not.”
With the help of other data sources, several different data elements are gathered and a certain scoring model is built for that particular individual which will help Digitap.AI’s clients to make a final decision. The company looks at an individual’s data sources like bank statements, telecom data, information from social media platforms, E-commerce platforms, employment data etc. all with the consent of the individual.
“We access all the data only with the consent of the individual…the data that we have is highly sensitive, so we don’t store the data with us,” Kommu explained.
Digitap.AI charges its clients on the basis of per API usage. It will either be an upfront one-time or integration fee. The company sees about 60% of its revenue coming from its scoring model.
The company works with about 90+ cumulative customers with the majority of its revenue coming from the APIs being consumed by the clients. Currently bootstrapped, the company has a run rate of Rs1 crore per month. The fintech company had a revenue of Rs 70 lakh in FY20-21 and Rs 6.4 Cr in FY21-22.
In India, the API based solutions for credit underwriting and onboarding solutions has a market of $0.5 billion and globally this market is valued at $20 billion. With the market being widely spread with high potential, companies like Digitap.AI have a few competitors.
A few of the competitors in the space are Perfios, Idfy, and Signzy. Idfy has raised $15 million and Signzy has recently raised $26 million. Perfios values at $400 million after raising $70 million from its existing investors this year.