Anil Pinapala, Founder & CEO, Vivifi India Finance Private Limited

Flexsalary is a cash advance against the inherent equity in the salary of the customer.

Nov 25, 2018 06:11 IST India Infoline News Service

Anil Pinapala, Founder & CEO, Vivifi India Finance Private Limited
Anil Pinapala, Founder & CEO, Vivifi India Finance Private Limited, is a serial entrepreneur in the Technology based Digital Lending space. He is the Founder and Chief Executive Officer (CEO) of Vivifi India Finance Private Limited (Vivifi). In August 2017, Anil founded Vivifi India Finance, an FinTech NBFC that offers Innovative Financial Products to customers across the Credit Spectrum with focus on the Under-Served / Unserved Customers. Vivifi’s flagship product, FlexSalary is an emergency line of credit that provides unsecured personal loans to prime and non-prime salaried class individuals. FlexSalary has been received very well in the last 12 months of its commercial operations with over 20,000 active accounts and operating across the geography of India. 
In an interaction with Shweta Papriwal, Editor, IIFL, Anil Pinapala, Founder & CEO, Vivifi India Finance Private Limited, said “Our product is set up to service a customer’s needs in times of emergencies with the ability to quickly withdraw funds and be able to pay back whenever they can.”
How does the model of cash loan against salary work for you?
Flexsalary is a cash advance against the inherent equity in the salary of the customer. The objective of our endeavour is to be able to help our customers stand on their own feet leveraging their earning potential in times of need.
Our product is set up to service a customer’s needs in times of emergencies with the ability to quickly withdraw funds and be able to pay back whenever they can. This way, we provide options which do not overburden customers during emergencies.
Our machine learning driven underwriting models approve customers based on their income and their ability to repay, that allows us to assess any given customer beyond the traditional underwriting which is driven by the Credit Score and Credit Bureau report. This enables us to offer Credit to customers who wouldn’t be considered Prime. As it stands today two-thirds of our customers are traditionally those who will be considered as Non-Prime or New To Credit and will find it very difficult to obtain any unsecured credit from Banks or traditional NBFCs. 
How do you ensure that the customer pays back the loan as well as the interest cost?
Our model to ensure customer repayments for the loans extended is equally dependent on what we do prior to extending the credit, as it is on what we do after issuing the loan. Prior to issuing credit a 4 layered underwriting process assesses the risk for each individual customer, that focusses on Elimination of Fraud, Establishing Intent to Repay, Assessing Ability to Repay and ensuring the Customer has provided us with adequate payment mechanisms that ensure our ability to obtain the payments in a timely manner.
Post loan issuance, we have a very strong customer education and notification process that continuously keeps the customer informed of their payment obligations and obtains their confirmations to meet their repayment obligations. Every loan payment the customer makes has an interest/fees component and suggested minimum principal paydown. The product is structured in such a way that it incentivises Principal repayment behaviour.
Do you empanel with the companies or any person can approach you directly? 
Our customers can approach us directly by going on to our website through Desktop or mobile web or simply download our FlexSalary app on Playstore or App Store to apply for a loan.
We are in the early stages of formalizing some corporate relationships to empanel companies especially those which have a large work force with incomes below INR 30,000 per month as we are one of the few companies that extends unsecured loans for customers with incomes as low as INR 8,000 per month.
What are the documents that are required in order to avail the loan?
The customer is required to provide us with information related to their Identification, PAN, Address and Income. It is our endeavour to have a near paperless, automated real-time approval process. This is incumbent upon the customer providing the required information including Electronic Bank & Income Verification providing us instant access to their salary account details.
As we are currently in a state of flux related to regulatory uncertainty for the use of Aadhar, eKYC and using e-sign for NACH Mandate the various steps in the process may not be necessarily paperless even if they are automated. For the fulfilment of loan we may require an attested copy of PAN, current address proof, a signed copy of the Agreement and a signed NACH Mandate
We are hoping the government regulations will provide relief to Fintech NBFCs like us to enable the use of the excellent infrastructure we have available in Indiastack to allow for e-KYC, e-sign and e-mandate registration that will dramatically increase our ability to scale and offer loans to underserved customers.
What is the maximum period of time for which the loan is provide?
FlexSalary is currently structured as an open-ended line of credit that has a one-time approval and the customer can use it anytime they need to access the credit. Since, we view Flexsalary as an Emergency Personal Line of Credit, the open-ended nature enables to customer use it in the time of need to meet any unexpected expenses or manage their cashflows.
Emergencies knock on the door without a warning and we’d like to be present to our customers at any time and in any manner as chosen. Once a credit line is approved and sanctioned, it is always available to the customer at the click of a button and the funds are transferred to the customer in real-time.
What is your largest customer base? What is your geographical presence?
Our largest customer base today is the traditionally unserved and underserved population in terms of the credit. More than two-thirds of our customers are those who would be considered Non-Prime or New to Credit and one-third of our customers are the ones with a Prime Credit Score.
Once a customer is tagged as below-prime, the options for credit are severely limited and we are able to successfully lend to these customers only based on our sophisticated AI driven models and true risk-based pricing. For the New to Credit borrowers we evaluate several other parameters that enable us to extend credit.
Also more than 80% of our customers have an income less than INR 40,000 per month once more are usually the ones who have been in the work force for little time and haven’t been able to gain access to most forms of credit with most of them not owning a credit card! The non-prime population are those borrowers who have the ability and intent to become good borrowers but unfortunate incidents which might happen to anyone have pushed them to the other side of the Credit spectrum.
As we are a true digital lender we today have pan-India presence and we have received loan applications across 29 states and 7 union territories, though the top 6 cities of Hyderabad, NCR-Delhi, Mumbai, Bangalore, Pune and Chennai contribute more than 60% of our loan applications
What is your strategy of dealing with loan default?
We have a very customized approach for loan default and are cognizant to the fact that no two defaults are the same. We do understand that customers can fall on hard-times and our process is focussed on working with the customer to find remedies to the delinquency. We strongly rely on customer education explaining to them negatives related to non-payment and how it could affect their ability to access future credit not just with us but with every other financial institution. This is a strong influence to manage defaults.
Further, as our loan allows customer to make partial payments and provides them the ability to re-draw as long as they stay current and have available credit, explaining the inbuilt benefits of the product is another strong remedy.

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