Mr. Shalya Gupta, CEO, Credifin Limited

23 Oct 2024 , 10:32 PM

What current trends are you observing in the demand for electric vehicle loans, particularly in the context of E-rickshaws and E-loaders?

The demand for three-wheeler electric vehicles, both passenger and loader, is substantial. The loader segment remains largely untapped and with increasing supply chain requirements across the country, the penetration is only likely to grow.  While sales in the northern and eastern regions in the country are slowing due to higher penetration, the majority of the country is still underserved. Over the next 5 to 10 years, we can expect significant demand growth in the L3 and L5 electric vehicle categories.

How do government initiatives and subsidies for electric vehicles influence your lending strategies? Are there specific programs you leverage?

Government subsidies and initiatives are welcome at any given time and can lead to creating a more enabling eco-system.

But, from the financing perspective, these are not relevant, especially in the 3W category, where not much impact is visible.

Are there strategic partnerships or collaborations with manufacturers or local governments that enhance your EV lending offerings?

Yes, we collaborate closely with manufacturers to ensure that not only are we and our customers are secure, but the manufacturers are as well. Many financing decisions have relied heavily on manufacturers’ guarantees for non-performing assets, which is an impractical approach. In our model, manufacturers’ guarantees focus solely on vehicle quality, not customer performance, ensuring that the responsibility for creditworthiness lies with the financier. This way, customers are protected from manufacturing defects and can expect quality service from their dealerships and the manufacturers can focus on quality and service rather than anything else.

As on date, we have no local government partnerships in place, but are open to these if and when the possibilities open up.

Can you elaborate on how your tailored financial products specifically empower local entrepreneurs and small businesses? What success stories can you share?

A key aspect of our lending process is assessing the end use of the funds that we provide to entrepreneurs. We ensure that 100% of their needs are met, effectively solving their complete problem. Unlike most micro-segment lenders who focus solely on income generation capacity, we prioritize actual financial requirements.

For instance, if a customer requires a construction loan, and monthly EMI capacity suggests a limit of ₹5 lakh, but the customer needs ₹6 lakh, we adjust ROI or loan tenure to meet that need. This helps the customer to address his requirement without looking at alternative multiple means of finance, that can potentially cause jeopardy to his repaying capacity.

Additionally, we meticulously map every end use for the loan, avoiding a one-size-fits-all approach.

How does Credifin Limited align its business model with the Indian government’s target of achieving 30% electric vehicle penetration by 2030?

At Credifin, our stated purpose is to ensure that we provide financial solutions to the underserved communities that help them eke out a better living. This is achieved through a focus on e-vehicle loans that are income generation and further the cause of sustainability at the same time. Today over 65% of our loan portfolio is focused on this category.

30% electric vehicle penetration is an ambitious target but achievable with a concerted effort on creating an enabling atmosphere. We are happy to be a small part of the system focused on sustainable transportation.

What are Credifin Limited’s long-term goals for expanding its EV financing portfolio, and how do you plan to adapt to the rapidly changing landscape of the electric vehicle market?

Our primary objective is to establish a presence in every state across the country, seeking opportunities to finance and support our customers in the electric vehicle (EV) sector. We have already launched our two-wheeler loan offerings and expanded into the L5 category.

Moving forward, our next steps include introducing loans for used electric cars, as well as higher-ticket financing options for light and heavy commercial vehicles. To enhance value for our existing customers, we have developed a specialized product for battery financing, ensuring that they maximize the benefits of their electric vehicles.

In addition, we are excited to announce our entry into solar panel financing, aiming to create a holistic, sustainable ecosystem that is both environmentally friendly and cost-effective for our customers.