Tejbir Singh was with TaxiforSure, a cab aggregation start-up, taking care of its multi-city expansion. After the company was bought over by Ola, another cab aggregator, Tejbir and Hemal Bhatt, a colleague from TaxiforSure, were looking at doing something on their own. The cab market then, says Tejbir, was about $5-6 billion size in India, with multiple players. They wanted to look at a market that was much bigger than this for their venture.

“When you looked at healthcare, back in 2015, the actual spends on healthcare were around $150 billion, just in India. This was a market that was 30 times bigger than cabs, but you didn’t have a single Meru, Uber, TaxiforSure or Ola on the landscape. We just wondered why. How can such a large white space exist,” says Tejbir.

The trigger point

According to him, there was another trigger for their idea. When they were building the TaxiforSure business, nearly 90 per cent of the bookings used to come through the call centre. Just about a year later, in 2014, the number had swapped and 90 per cent of the bookings were made through apps and only 10 per cent was done through the call centre.

“We said, are there white spaces still left where we are still to see this offline to online transition. Once again, healthcare checked that box,” says Tejbir.

Digital channels were still not quite popular when it came to healthcare; people preferred to walk down to the pharmacy to buy their medicines. Healthcare was a large enough market, where the offline to online transition hadn’t happened, which meant a lot of emphasis on the technology and the kind of product that had to be built. Tejbir says they were clear that they did not want to build a business that would cater only to the top 5 per cent of the population. Given his initial interest in finance and financial services, Tejbir realised that the intersection of healthcare and financial services was an ideal place to be in.

Thus was born AffordPlan. What was the idea behind the venture? If you look at the majority of the population, they went to the neighbourhood hospital or nursing home for their medical needs and not to large corporate hospitals. Tejbir says they looked at the small- and mid-size hospitals, those with 15-75 beds. The Delhi-NCR alone has about 1,500 such institutions, of which 110 had more than 100 beds and and the balance 1,390 less than 100 beds. That is the level of fragmentation in the healthcare industry.

He says they started talking to these hospitals to figure out what exactly they should do. They wanted to understand the profile of the patients who came to these hospitals and how they paid for their treatment. Not all of them had medical insurance or were covered by government health schemes. During their discussions, they found that 40-60 per cent of the patients who came to these hospitals went back without getting a procedure done because they did not have liquid cash on them. “The problem was not income. We were not solving for the income problem. We were solving for the liquidity problem,” says Tejbir.

Just think of someone earning ₹40,000-50,000 a month, but has to shell out nearly ₹70,000 for a cataract operation for a parent. Most often, they put off the surgery till later, while some took personal loans at high interest rates for the treatment. That is where AffordPlan stepped in and said it will come out with a structured savings product that will help patients save a fixed amount on a monthly basis for a specific period so that they can pay for the elective medical treatment. This was not meant for emergency procedures.

In designing this product, Tejbir says he was inspired by what he had learnt in business school – a case study about Walmart pioneering a product called Layaway that helped its customers save money to buy consumer durables products from it.

“We said we can deliver something along these lines and create a more sophisticated version of a savings product. That is where we started. We started working with the hospitals to create these customised savings solutions for elective procedures; procedures where customers have time to plan and save,” says Tejbir.


SaaS product for hospitals

AffordPlan created a SaaS product for hospitals. A patient coming into the hospital would be exposed to AffordPlan’s products. If he or she signs up, the algorithm will plan for the monthly savings and the period of savings too.

The money will be aligned with that particular hospital, it will be in a separate account that the customer cannot access. Instead of earning an interest on the savings, customers will get 15-20 per cent discounts on medical bills, lab tests and the like. For the hospitals, this savings products means that many patients who could not afford to undergo the elective medical procedure due to liquidity issues would actually come back to them for the procedure.

AffordPlan has 800 merchants in five cities in India, has touched over three lakh patients and enabled over thousands of procedures. Even as it expands, it has started thinking of two more products – a loan and an insurance product.

“We are looking at building a full stack of financial services for healthcare. We started with savings for elective procedures, we will go to loans for elective and emergency procedures and then we will go to micro-insurance that will cover other categories of spends that a customer has. This full suite pretty much sums it up across all the categories,” says Tejbir. AffordPlan takes a service fee from the hospital for the technology interface. The hospitals can use its SaaS product as a hospital management system too.

Tejbir says they had put in all the hard work in getting the hospitals on board and had a product-ready before they went in for external funding. They built the distribution network too profitably, without burning investor cash.

“It is the most difficult pieces that we have done that define us. It is not easy for anyone to come and start building this network overnight. It has taken us two to two-and-a-half years just to build this network,” says Tejbir, about the moat they have built around the venture to stave off competition.