Reports suggest that OneCard, a fintech unicorn, and WintWealth, an emerging startup, are both looking to obtain licenses as non-banking finance companies (NBFCs). This move will see them join the ranks of other NBFCs such as Jupiter. Additionally, Upstox, a stock trading platform, has announced its intentions to venture into the credit market by collaborating with NBFCs. The Indian fintech industry recognizes the potential for profit in digital lending, which has caught the attention of investors seeking opportunities in the growing demand for credit for consumption purposes.
Reports have emerged about Fintech unicorn OneCard and another emerging fintech startup WintWealth vying for a non-banking finance company (NBFC) license. These startups are aiming to join the ever-expanding roster of NBFCs, including recent beneficiaries such as Jupiter, who have successfully obtained lending licenses, according to undisclosed sources.
Stock trading platform Upstox is apparently plotting its entry into the credit sector. However, it seems they are initially considering partnerships with existing NBFCs before venturing out on their own.
OneCard, co-founded in 2018 by Anurag Sinha, Rupesh Kumar, and Vaibhav Hathi, has made waves by issuing co-branded credit cards in collaboration with South Indian Bank, Federal Bank, BoB Financial, and SMB Bank. Notably, they introduced their maiden mobile metal card in 2020. With the prospective NBFC license, OneCard’s expansion into the personal loan segment is expected to be smooth sailing.
On the other hand, WintWealth has distinguished itself by offering aggregated debt instruments in a SIP-style format, catering to the risk-averse while yielding attractive returns. Such investment opportunities are typically reserved for individuals with substantial wealth. Moreover, if WintWealth secures the desired license, they might consider incorporating additional services such as loans against the corporate papers held by their clientele.
There were murmurs earlier this year that the Reserve Bank of India (RBI) harbored concerns regarding the issuance of NBFC licenses to fintech startups. These concerns primarily revolve around the ownership structure of these fintech firms and the sources of their capital inflow.
In April, Neobank Jupiter successfully obtained an NBFC license from the RBI, becoming the latest recipient. Prior to that, in November 2022, microlending startup ftcash was granted approval for its NBFC license.
The realm of digital lending has emerged as a lucrative avenue for India’s flourishing fintech startups to explore. Notably, Kunal Shah-led CRED is ambitiously eyeing the lending space to cater to individuals with no previous credit history.
As per the State Of Indian Fintech Report Q2 2023 published by a prominent media firm, the lending technology sector is predicted to grow substantially, potentially reaching a staggering $1.3 trillion by 2030. Consumer lending, in particular, continues to captivate the interest of Indian startup investors due to its wider market potential and the escalating demand for credit-fueled consumption across the nation.
