Unicas to open branches in tier-II, tier-III cities

Debangana Ghosh Mumbai | Updated on November 24, 2021

The firm has a customer-base of 10,500 across crypto-based savings account and lending products, and will be launching five more branches by December

Cryptocurrency based offline financial services company Unicas is expanding to find its customer base in tier-II and tier-III cities through a series of branches planned in cities like Lucknow, Surat and eventually Indore, Baroda, Ahmedabad and Bhavnagar among others. By next year, the company is estimating to onboard over 2,00,000 customers.

The firm currently has a customer-base of 10,500 across crypto-based savings account and lending products, and it will be launching five more branches by December this year. Of this, three branches will be in Delhi and the remaining two in Lucknow and Surat. As of now, Unicas has three active branches in Delhi, Jaipur and Jamnagar apart from its headquarter in Noida.

Expanding network of branches to smaller cities and towns will remain key to Unicas’ business model, Dinesh Kukreja, Co-founder and CEO, Unicas told BusinessLine.

“Our target customer-base includes ordinary people of the age group of 30 to 60 years. We are looking to service areas where people are not that tech or internet-savvy because that’s where they would need access to a branch. We are exploring cities like Indore, Surat, Baroda, Ahmedabad, and Bhavnagar to name a few for setting up our branches,” Kukreja said.

Unicas is a joint venture between London-based neo bank Cashaa and Jaipur-based microfinance firm United Multistate Credit Cooperative Society, started in December 2020. The firm was earlier planning to launch around 50 branches pan-India by end of 2021. However, they ended the year far from the target due to the pandemic.

Regulatory haze

Unicas doesn’t have any RBI licenses owing to the nature of its services, which include cryptocurrency-based savings account, lending products and trading platform. It will soon launch its fixed deposit offering.

The start-up has partnered with crypto exchange Bitbns and is in talks with Taxfull, a crypto-friendly tax payment platform.

While the RBI and the government are still deliberating on their policy and stand on regulating cryptocurrencies, it leaves various start-ups and financial services companies like Unicas in a grey zone as they try to self-regulate their platforms.

“We don’t have any RBI licenses at the moment. Right now, it is not very clear whether the RBI or SEBI or some other agency will control crypto and what regulations will come in place. We are still waiting for that. Whatever is decided, we will readily abide to that,” Kukreja said.

He added, “When we started in December 2020, there was a lot of uncertainty. I have been in the crypto industry for over four years, and one thing is for sure – it will not be banned entirely. If banned, it will hamper India.”

Kukreja decided to meet his long-time friend and Cashaa founder Kumar Gaurav to start Unicas when his microfinance lending cooperative got hit during the first wave of pandemic causing bad loans as many couldn’t repay.

“By March 2020, the Supreme Court had lifted ban on crypto trading in India and people had started following it. After microfinance went through a crisis, I was thinking on how can we disburse loans differently which will be secure for us. That’s when I thought of crypto,” he said.

Product offerings

Unicas is letting its customers transact and trade in the top 10 cryptocurrencies, including Bitcoins, Ethereum, Dogecoin, Lightcoin, Tether (stable coin), and Cashaa token among others.

Cryptocurrencies are notorious for valuation fluctuations. For instance, Bitcoin valuation had reportedly plunged by nearly 20 per cent over the past two weeks.

To hedge such a situation, Unicas is providing only 50 per cent of the crypto asset value as loan amount for the lending product. “If the value of Bitcoin goes below, say, 50 per cent, the crypto token will be liquidated and the loan will be safe,” Kukreja said.

These loans will work like bank overdraft where there will not be any immediate fixed tenure for repayment. It can be repaid in a day, a year or even two years. The loans are disbursed at an interest rate of 15 per cent per annum or 0.04 per cent per day.

For the savings account, customers are offered up to 9.67 per cent interest annually. The upcoming fixed deposit will be offered at 12 per cent interest. “Savings accounts are the most sought after offering for us. People are buying crypto and hoarding them.”

Published on November 23, 2021

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