Square Capital: A Loan Aggregator Bridging Gap between Financial Institutions &Loanees

Indrajit Sidhanta, Deepak Khadelwal &  Amit Prakash Singh,Principal PartnersThe retail lending space in India is huge and rapidly growing. Almost 50 percent of the business comes directly or indirectly from vivid small & big unorganized brokers, while remaining business is sourced by banks directly. It clearly shows dependence of banks on such channels as it is cost effective for them. Meanwhile, the sector has undergone through disruptive changes in the last decade as far as adoption of technology is concerned. Unlike traditional players, pure online players are good in digital lead generation but don’t have fulfillment expertise or distribution strength. Hence majority of their leads remain unfulfilled and their unit economics is unable to do a profitable business. Gurgaon based Square Capital – a part of the Square Yards, addresses these qualms by positioning itself as a hybrid online-to-offline player, where in it is able to generate digital leads and do fulfillment offline.

Being India’s first unbiased loan advisor, company acts as a loan aggregator providing the entire gamut of fulfillment support for the lending process on a single
platform including assessing the credit worthiness/risk of clients, helping them to choose the right product from the appropriate lending organization, managing their documentation, advising on professional issues pertaining to taxation & insurance, and assisting them throughout the process of loan disbursement. “With the virtue of our relationship with 500+ real estate developers across India & internationally, we are able to source quality business at lower cost,” asserts Deepak Khandelwal, Principal Partner, Square Capital. In a short span of three years, venture has gained a run-rate of around Rs.260 crore to Rs.325 crore of monthly disbursals, which is contributed by 400 to 600 loan transactions spread across 40+ banking partners for their different products (home, business & personal loans, and loan against property).

Square Capitalis in the process of developing an integrated tech platform that will take the entire end-to-end cycle of mortgage lending to an online platform

Enforcing New Technologies

In the world of financial services, borrowing is paramount. Proper guidance on the right amount of loan at the correct price & time,and meeting the eligibility criteria for credit score have become vital concerns for majority of borrowing customers. Thus, Square Capital
works on clients-based model where in it thoroughly understands the client’s requirement, employ non-traditional data to generate lead digitally, provide them alternative methods to determine their credit worthiness and advise them the most suitable loan product in the market at the best rates. It also provides customized lending solutions and started serving NRIs for their property purchases in India. Passionate towards providing lending solutions, Square Capital developed a mobile app (Square Beats that assist sale team to get real time lead and help them to serve clients needs instantly) and a strong tech platform (Square Connect that aggregates all small brokers, CAs,and financial advisors by giving them common platform to advise their customers on right lenders).

Future Roadmap

Aiming to enhance its presence in international markets apart from Singapore, Hong Kong, Australia and Canada), Square Capital has started an independent business unit in Dubai to assist UAE clients locally. With a significant loan disbursal growth from past one and a half years, company targets to cross monthly disbursal of Rs.700 crore and increase its work force to 1000+ by end of this FY. Additionally, venture is in the process of developing an integrated tech platform that will take the entire end-to-end cycle of mortgage lending to an online platform including customer query, product policy check, credit decision, eKYC check, online applications integrated with bank's backend system and right through disbursal of loans.