On Tuesday, NBFC-MFI Arohan Financial Services launched a digital lending app for its existing customers having good repayment track record to provide them an experience equivalent to that of privilege banking and to “raise collection efficiency ratio”, an official said.
The app, ApnaArohan, will help its customers make repayments and other transactions through the digital mode and reduce physical interaction with the loan officers of the MFI, which is needed as Covid has changed the entire business dynamics across sectors, Arohan Managing Director, Manoj Kumar Nambiar said.
The AI-powered app will provide the microfinance company the "first mover advantage" and help increase the outstanding portfolio from ₹4,500 crore, as on June 2022, to around ₹5,100 crore by the end FY23, he said.
This will help complete digitalisation on disbursement and collection exercise of the MFI, Nambiar said.
Credit scoring model
During the pandemic, the collection efficiency ratio had dipped from the pre-Covid levels of around 99 per cent to around 60-70 per cent, he said.
"Now, this has stabilised at around 95 per cent," the company official said, adding that the MFI, promoted by the Aavishkaar Group, is in the process of creating a credit scoring model, which is now "under beta testing".
The MFI has been on the core banking platform since 2017.
It plans to raise ₹1,800 crore from the market, and the key investors of the MFI are Michael and Susan Dell Foundation, Aavishkaar Goodwell Fund II, and Tano Capital.