Franklin Templeton-backed Wishfin wants to become the ‘go to’ digital destination for all personal finance needs including loans, insurance and investment management.

Web-based lending platform, Deals4loans, has reemerged in a new avatar as Wishfin, offering an end-to-end personal finance management solution in a single platform, enabling its users to take responsible financial decisions.

Simply put, Wishfin’s goal is to help people finance their wishes, but prudently. It helps them understand their spending patterns, if they can pay EMIs to fulfill their wish or invest in funds that will help them achieve their goals with better financial security. “There is a lot of social pressure and people tend to make spending decisions based on what their peer groups are up to. Several times these financial decisions will not make sense,” points out Rishi Mehra, co-founder and director of Wishfin.

The company’s online platform handholds a customer to make the right personal finance decision – be it taking a loan, analyzing one’s ability to pay EMIs on time, or postpone a decision to a later date and plan investments to meet a particular goal.

Neutralizing bias

Wishfin was established as Deals4loans by Mehra in 2006. A serial entrepreneur, he already had experience running a venture that provided warehouse optimisation solutions. Along with Deals4loans, he also started EvolveTech, which developed products for mobile towers around the same time.

In 2010, there was an inflection point in digital personal finance and consumers started searching for loans online. The Deals4Loans portal, aggregated loans from several banks and presented the best option for a particular customer.  “Traditionally, the first option for loans was always their bank, where one had an account. But that wasn’t necessarily the best option for a person,” explains Mehra.

Currently, Wishfin’s platform is purely algorithm-based, when it comes to suggesting loan options for a particular customer’s goals. While the platform was free for customers, Wishfin charged the banks a referral fee, when a loan was granted. It was a customer acquisition channel for a bank, but the algorithm would not change based on a bank’s incentive to Wishfin.

Of course, Wishfin also had to conduct credit assessments of applicants in certain cases, in addition to a bank’s own due-diligence process.

“In 2016, the company received US $15 million from Franklin Templeton that enabled it to build its technology platform, add features and convert it into a personal finance management product, that offers more than just loans.”

A new avatar

Wishfin has always looked at being profitable, right from the beginning, and used a pull model to attract customers while keeping costs in check. Until last year, it had a team of around 50, which has gone up to 180 currently. In its first avatar (till 2015), the company was self-funded and ran on internal accruals and on investments from individual investors such as Puru Vashishta, Ram Sriram and Neeraj Arora.

In 2016, the company received US $15 million from Franklin Templeton that enabled it to build its technology platform, add features and convert it into a personal finance management product, that offers more than just loans. Apart from personal, home and car loans, consumers can also invest in fixed deposits and mutual funds, depending on their financial goals. It also offers life, health and car insurance, thus covering all aspects of personal finance. Additionally, Wishfin is working on improving the last mile process of loan sanction. Typically, banks send their staff to collect documents. Over time, Mehra and team hope to establish some automation into this process, which is currently bottleneck to deal flow.

Scaling up customer acquisition

Today, Wishfin has eight million registered users and adds 2.5 lakh users every month and experiences 30 per cent to 40 per cent repeat customers. The company has disbursed more than $2 billion in loans through its platform and is currently clocking an annual disbursal run rate of $500 million. The company works with top 40 banks in India and plans to reach a disbursal of $1.5 billion by mid-2017. It has customers from nearly 500 cities in India and, typically, its users fall in the age bracket of 27 to 40.

Looking ahead, although the government’s recent policies paralyzed the market in the short-term, they are expected to boost digital finance solutions over the medium to long term. This will further the customer base for Wishfin as even those who preferred offline channels will start looking for solutions online, according to Mehra. “We feel positive overall as there is more money in the banks and so the interest rates have fallen. Affordable housing will become a reality. All this will benefit the people and businesses like ours,” says Mehra.

When one looks at the larger picture, this industry is not without its challenges. India is a vast country with each region having its own unique set of requirements and integrating with bank APIs across regions poses its own difficulties. There’s also the mindset of the bank employees who have to reconcile with shorter processing times. To make them realize that the fin-tech sector is an ally and not competition, is a big challenge in itself.

At this interesting juncture, Wishfin will focus on strengthening its position in India and then look at pursuing international markets, possibly in 2018. “Wherever we do business, our vision is to help consumers take responsible financial decisions and provide solutions and services that will help achieve that,” concludes Mehta.

Responsible personal finance management

Wishfin was established as Deals4loans that focused on enabling consumers find the ideal loans that match their requirements. In its new avatar, the company aims to be a complete end-to-end finance management site that offers loans, investments and insurance. Its aim is to help consumers make informed financial decisions and invest or take loans based on their needs and understanding of their financial situation. Its algorithm based search engine ensures neutral and optimal results, thus, establishing the portal’s credibility. Started by Rishi Mehra in 2006, the company recently received funding of US$15 million from Franklin Templeton. This enabled it to build on its technology platform and boost the team from 50 to 180. The company has disbursed more than $2 billion in loans through its platform and is currently clocking an annual disbursal run rate of $500 million. In the near future, Wishfin aims to strengthen its presence in the country and in 2018, identify and expand beyond boundaries.

Snapshot

Wishfin

Founder: Rishi Mehra

Year: 2006

Industry: End-to-end personal finance management

Investors: Individual investors and Franklin Templeton