Freo

On the MoneyTap platform, consumers can borrow anywhere between $46-$7,715 (INR 3,000 to INR 5 Lakh) with an option to choose the repayment duration from as little as two months up to three years.

The entire process of credit evaluation takes around 3 to 7 minutes, depending on how fast the customer types. Unlike other consumer lending platforms, credit assessment on MoneyTap happens in real time.

Kunal Varma, Co-Founder, FREO said: "India and SEA, have over a billion digital natives and we understand that the way some of them have accessed financial services in the past will not be the same way in which products of the future will be built."

FREO is a first of its kind, credit-led Neobank in India that is designed to serve the banking needs of millennials in India and Southeast Asia.

The consumer lending startup claims to currently cater to customers with monthly income ranging between $308-$1,080 (INR 20,000-INR 70,000), originally across 14 Indian cities.

MoneyTap (Freo) built its customer relationship to run through the app rather than branches or offices; the founders said in-person contact ("feet on the street") is needed only for loan collections and KYC verification, and even those are handled by the banking partners rather than MoneyTap staff.

Customers control their own usage: once approved, they can draw down the credit line whenever and however much they want, and owe no interest on any unused portion of their limit.

Freo positions the relationship as ongoing and all-in-one rather than a one-off loan product, aiming to be customers' single point of access to a range of financial products across their lives.

Once a user downloads the app, after answering the set of questions to a chatbot, the user is informed upfront whether he/she is eligible for a credit line... all you need to do is press the button on the app and the amount will be transferred within 15 seconds.

The company runs its own creditworthiness evaluation — pulling salary and employment details, a credit bureau check, and in some cases bank statements — to reach an eligibility decision, a process the founders said takes about 3-7 minutes.

A core internal activity is engineering the backend that connects to partner banks and handles data compliance — described as the real technical substance behind the app's simple front end.

Beyond organic growth, the company actively runs digital marketing channels — Google, social media and content marketing — to onboard new customers, having grown to 300K registered users across 14 cities within 8 months of its September 2016 launch.

In early 2021 Freo expanded beyond its core credit line into buy-now-pay-later, launching a product enabling QR-code-based purchases at retail stores as well as online transactions.

MoneyTap's (Freo's) backend credit-decisioning system — including its data compliance system and bank integrations — runs on in-house technology; co-founder Bala Parthasarathy said the company had already filed patents on five of its proprietary technologies.

At the time of reporting, MoneyTap ran with a small internal team split between a Bengaluru head office and a Mumbai office, which the founders expected to roughly double within a year as the company scaled.

Freo's installed base of borrowers and cardholders, built through the MoneyTap product, underpins its lending and cross-sell activity: over 11 million users, more than Rs 4,000 crore in credit disbursed, and 175,000 credit cards issued.

The consumer lending company is currently working with seven banking/NBFC partners at different stages of integration, including the RBL Bank.

A suite of cards with features like auto-EMI & pay later for both online & offline transactions coupled with 175K cards already issued in partnership with RBL Bank.

At present, MoneyTap charges a one-time setup and origination fee of $7.7 (INR 499) plus tax.

Compared to credit card interest rates which typically range somewhere between 3% and 4% per month, the interest rates charged by the MoneyTap app are just over 1.5%.

Co-founder Bala Parthasarathy said the hardest challenge in consumer lending is acquiring capital cheaply; by sourcing funds through bank partners rather than P2P networks, MoneyTap avoids the higher KYC and origination costs that push up P2P lenders' rates, which he said is the real reason it can offer low interest.

Co-founder Bala Parthasarathy credited India's Aadhaar digital identity rollout with reducing the compliance costs that fintech and consumer-lending companies like MoneyTap must bear for onboarding and verification.