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Flipkart testing video-based KYC solution to launch customer lending

Flipkart testing video-based KYC solution to launch customer lending
Photo Credit: Photo Credit: VCCircle
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Homegrown e-commerce giant Flipkart is preparing a video-based Know Your Customer (KYC) solution to offer instant credit to its customers, a media report said.

The company is piloting a project for digital KYC with nearly 10,000 customers and is awaiting approvals from the Reserve Bank of India to test it with more customers in the near future, The Economic Times reported.

The Walmart-owned company began working on the new solution after the Supreme Court struck down Section 57 of the Aadhaar Act last year, disallowing private companies to use the unique biometric identification system to establish the identity of individuals.

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While it is unclear if Flipkart has applied for a non-banking finance company (NBFC) licence from the RBI, Ranjith Boyanapalli, vice president of fintech and payments at the online retailer was quoted as saying that an NBFC licence application is a natural progression of its credit business.

Citing Suyash Motarwar, director of engineering at Flipkart, the report said the company has received an in-principle approval from the RBI.

Flipkart’s alternative eKYC solution will use data from the platform and outside to measure a customer’s ability and intent to repay loans. Its proprietary credit underwriting model tracks 500 to 1,000 data points to gauge a customer’s credit default risk.

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An email sent to Flipkart seeking details of its digital lending initiatives did not elicit an immediate response.

Flipkart's decision to shift its focus back on customer lending with an aim to create a pre-approved line of credit come after its earlier attempts to partner with digital lending startups to offer ‘cardless credit’ and checkout finance solutions did not pick up pace.

Flipkart partners with a number of fintech partners such as Fosun-backed startup Kissht and Xiaomi–backed ZestMoney to offer credit solutions to its customers.
The company had appointed Monomita Roy Avasarala as director and head of product for its consumer fintech business when it began working with third-party players to offer mutual funds, insurance products and loans.

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According to the firm’s filings with the Registrar of Companies in late 2017, Flipkart had planned to sell products in general, life, health and motor insurance verticals. Flipkart, which sees this segment as a potential revenue spinner, is betting on its large customer base to grow its insurance business. Besides, it is counting on its large volume of consumer insights data and its customer experience offerings.

It later launched a programme for customers shopping on its platform to avail insurance when buying smartphones. The Bengaluru-based company secured a corporate agent licence for the service and runs its insurance business in partnership with Bajaj Allianz General Insurance.


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