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Datacultr

AI-driven behavioural models, to derisk loans to unbanked

UAE
Market: Financial services
Stage of the project: Operating business

Date of last change: 27.09.2021
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Idea

Data-driven digital debt collections & risk mitigation SaaS: reduces 1st month defaults by 25%; NPAs by 67%; improves collections by 4X. Digitizes processes & engagement; collateralizes smartphones

Current Status

Datacultr has thus far secured over 300k new loans on its platform. It is live in India, Bangladesh, Malaysia, Pakistan & ivory Coast with pilots on-going in Peru, Indonesia, Ecuador, Egypt, Mexico & Brazil
Datacultr is currently securing 3000+ new loans every day.
Datacultr’s customers are lending institutions, that provide micro-loans and other products to middle & low income groups. These include- Banks, Non-Banking Financial Corporations, MFI , Telcos & FinTechs.
RESULTS:
1.NPAs: reduced by 67%
2.Monthly Default: reduced by 25%
3.Collections improved by 4X

Market

New To credit is a $200Bn annual opportunity for financial institutions in emerging markets, but there are inherent challenges. There are over 1.7bn Unbanked adults and another 2.3Bn under-banked adults globally. They have an inherent need for formal credit for working capital and personal reasons. This tantamount to US$20bn market for Datacultr

Problem or Opportunity

Banks face challenges of High perceived risk and expensive collections, when they cater to the unbanked or high risk customers.This happens because majority of this population is not in the organised sector, a minuscule of them pay taxes & its impossible to get their business & income data.The world over around 33% adult population is covered by credit bureaus, another 5% have a digital footprint that’s credible and can be used for building a risk profile, the balance 62% are ‘Credit Dark’.
In addition the overall process of collections is also tough & expensive in this segment

Solution (product or service)

$30Bn annual opportunity for Datacultr.
Datacultr begins the credit journey for ‘new to credit, by enabling lenders to provide financing/Pay-on-demand option by collateralising borrowers Smartphones. This solves:
•Credit Decisioning: Smartphone Collateralization, becomes a critical factor for the lender in absence of alternate data
•Repayment: Datacultr ensures payments are not missed, sets a habit, through ML driven engagement & collections digitization.
As repayments are made, a digital transaction history begins to form, which opens up other avenues for this segment

Competitors

Direct Competitors include:
1.Payjoy- active in Mexico & Colombia
2.Trustonic- active in more mature markets
Datacultr will have a bigger market share than these direct competitors

Advantages or differentiators

Differentiators:
1.Superior technology, that provides instant coverage across all Android devices, while competitors need to pre-integrate their software with every device that they want to secure, making scalability a big challenge
2.Focus on building a positive consumer behaviour through ML driven behavioural models, while competitors like to use a binary approach of locking a borrowers device, in case a default happens
3. Focus on consumer literacy, while competitors try to use coercive ways to recover money

Finance

SaaS Fees charged to the client for every loan that is secured on the platform.

LTV of an end user is estimated to be $7.8

Basis current client signups, sales pipeline & vision, we estimate our revenues to top US$150Mn in 5 years

Business model

Business Model: B2B SaaS
The client is charged a pre loan or per device fees (monthly or annual)

Money will be spent on

USAGE OF FUNDS-
1.Technology- Product extension to other devices and OSs, Data sciences for behavioural interventions and blockchain for fraud detection & debt transparency
2.Market Growth- South Asia, South East Asia, Middle East & Africa

Offer for investor

Raising US$500k at a pre-money valuation of US$6.5mn

Team or Management

Risks

1. Regulations, preventing financial institutions to use certain datacultr features
2. Datacultr's ML Models fail to build strong positive customer behaviour

Incubation/Acceleration programs accomplishment

Incubated by:
1.Startupbootcamp
2.Seedstars
3.Plug and Play
4.IAMAI-Mobile10X
5.Village Capital
6.Microsoft for startups
7. Jio Gennext

Won the competition and other awards

AWARDS & RECOGNITION
1.Economic Times, BFSI Innovation Awards, 2020
2.Red Herring Top100 Asia, 2019
3.NASSCOM Emerge50 India, 2018
4.Certificate of Excellence from Department of IT & Communication, Government of Haryana
5.Won a Grant of $20k from Paypal, Metlife Foundation & Village Capital run Finance Forward Program, 2020
6.Won an award of $20k from Philip Morris International, for innovation in financial inclusion
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Idea
Current Status
Market
Problem or Opportunity
Solution (product or service)
Competitors
Advantages or differentiators
Finance
Invested in previous rounds, $
Business model
Money will be spent on
Offer for investor
Team or Management
Mentors & Advisors
Lead investor
Risks
Incubation/Acceleration programs accomplishment
Won the competition and other awards
Invention/Patent
Photos
Product Video