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The current issues of the lending industry can be solved through technology and digitalizing the operations as much as possible. Thorough research and analyses on this matter have led Rishabh Goel to the idea of launching Credgenics, a technological solution to digitize a largely manual collections workflow. Rishabh was soon joined by Anand and Mayank, who is currently the CTO and COO of Credgenics respectively.
Analytics Insight has engaged in an exclusive interview with Rishabh to discuss his vision of creating a technology-based solution for the lending industry.
After graduating from IIT Delhi, I worked first with Deutsche Bank and then with Blackrock, where I understood the nuances of the lending industry and observed the problems with the current collections practices. These experiences made me realize the detrimental impact caused to an economy by bad loans, motivating me to find a scalable, technology-first solution to this burgeoning problem. My thorough research and analyses led to the idea of launching Credgenics, a technological solution to digitize a largely manual collections workflow. I was soon joined by Anand and Mayank, who is currently the CTO and COO of Credgenics respectively. Over time, we scaled the business to the north of 200 employees and our customer base to more than 60 lenders in India.
It was the problem-solving skill set and vision of our co-founders, which set the foundational stone for Credgenics. While working across banking and investment roles with Deutsche Bank and Blackrock, Rishabh observed that the lending industry was largely following archaic processes for debt recovery. While a lot of technological innovation had happened for underwriting and on-boarding by digital lending players, collections were still mostly reliant on manual, unscalable processes. The identification of these issues led to extensive research for a period of six months, post which the exact vision for Credgenics began to take shape. Today, we have a range of offerings that are being deployed by 60+ lenders in the country to make their collections processes digital and data-efficient.
We have a clear, simple vision – we want to help lenders 'convert their bad loans into good assets'. We believe that lower bounce rates and NPAs help lenders improve their P&Ls significantly, allowing them to decrease interest rates and make credit more widely available, thus helping accelerate financial inclusion in the country. Today, we offer a first-of-its-kind, AI, and ML-powered digital debt collections platform, which helps lenders achieve better resolution rates on stressed assets and reduce the time to collect while decreasing the overall collection costs. We aim to reduce the exponentially growing NPAs in the Indian Economy by harnessing the power of technology and data-driven analytics.
Bad loans and NPAs have always been a major area of concern for lenders in developing economies and this problem has further been aggravated by the pandemic. The ecosystem needs to improve collections and make them scalable while ensuring that credit growth and access do not get hampered. The aim is to curb NPAs, but not cause a blow to lend in less fortunate areas. We believe that an important part of the solution to these problems is digitizing the recovery and collections process.
Here we see ourselves playing a role through our new-age collections platform, which we believe is unique as it allows end-to-end management of the entire recovery and legal process across channels. Using our platform has improved the recovery rates for our clientele by up to 20% while reducing their time to collect and reducing their overall collections and legal costs.
We have already added many products on our platform recently, some examples being the voice bot module, payments module, and most recently the 'CG Collect' app for field collection agents. And with our recent US$25Mn Series-A fundraise, we intend to fuel our plans of international expansion to the Middle East, South East Asia, and other interested geographies in the near future. In order to achieve these goals, we would also further augment our technology team and add more leaders to other functions to create customized product offerings for each geography and solve for their unique pain points in the collections process. We hope to build a truly one-stop, global collections platform that brings the latest technology to the last leg in the lending journey – collections.
Emerging technologies like AI and ML allow us to predict future events based on available data, automate workflows, and mitigate human errors. Machine learning, predictive analytics, and artificial intelligence have boosted the fintech industry with improved credit risk assessment in lending, fraud detection in payments, and a host of other applications.
Firstly, the recovery chance predictor on our platform, which utilizes multiple parameters including borrower demographics, loan repayment history, contractability on different channels, etc. to predict the likelihood of repayment, helps lenders prioritize accounts from their large list of delinquent borrowers and implement customized strategies for different segments. The platform also recommends an AI-powered, personalized collections strategy to lenders, which helps them optimize and automate actions for different borrowers through a blend of digital communications, human operations and legal routes. This, in turn, helps lenders improve the RoI on their collections spending.
We also need to appreciate the fact that technology and its evolution is dynamic in today's fast-paced world, and we intend to always stay relevant by constantly updating our platform and the associated offerings.
Any industry takes some time to undergo digital transformation and adopt new solutions, and we have faced similar challenges too. However, by coming up with very relevant offerings and building strong capabilities in customer success and support, we have been trying our best to make the onboarding of our platform very easy and seamless for the end-users.
We have accumulated a lot of borrower data including demographics, repayment history, and effectiveness of different channels over a period of two years which serves as our model input. Algorithms built using machine learning techniques allow us to predict a borrower's propensity to repay a loan, enabling clients to prioritize accounts according to the probability of recovery. We use artificial intelligence to reduce the dependency on physical tele-calling agents and instead utilize voice and chatbots to facilitate client-borrower conversations. These bots have capabilities in 10+ languages, where our intention is to help lenders personalize communications for different sets of customers. We are currently working on several other innovative offerings in these areas and adding significantly to our team of data scientists as well.
Machine Learning, predictive analytics, and artificial intelligence have effectively revolutionized the credit risk assessment in lending, reduced frauds in payments, and are now helping lenders improve their collections. Since their arrival, these technologies have been reshaping the financial services industry on multiple fronts. AI/ML enables the prediction of future events based on the available data, helping automate a lot of surplus repetitive work and reduce human errors to a great degree.
In the last decade, Indian entrepreneurs have championed the prospect of bringing advanced technologies to solve complex problems. AI and ML have been pivotal in bringing solutions like digital credit disbursal, early warning signals, and real-time credit risk analyzer products, and we feel there are many other innovations that are yet to happen.
During the last three years, we have seen multiple milestones. We onboarded our first client last year, and have already grown to a customer base of more than 60 lenders. We have built a strong team and are augmenting it further by adding several industry leaders. Our funding rounds, including the most recent Series-A round of US$25Mn, have been the propellers for many of our aspirations. The confidence that investors have in us helps us dream bigger and serve our clients better. We are very excited to see what lies ahead for us.
