MEDICI Q&A with Gaurav Hinduja & Sashank Rishyasringa, Co-Founders at Capital Float

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The “FinTech Leadership During the COVID-19 Crisis” is part of the video series brought to you by MEDICI Studio and FinStep Asia. In this Q&A, Gaurav Hinduja & Sashank Rishyasringa, Co-Founders at Capital Float, answer a few questions about dealing with the COVID-19 pandemic as an organization. In this webinar, we cover Capital Float’s business introduction, its new product launches, and its style of leadership and management. 

This video Q&A was hosted and moderated by Syed Musheer Ahmed – Managing Director of FinStep Asia, and Amit Goel – Founder of MEDICI. The video series aims to showcase FinTech leaders at this time of the crisis and how they and their teams are navigating these uncertain times.

Snippets from the discussion

 

Capital Float in a nutshell

  • Capital Float was founded about six years ago
  • Capital Float’s vision includes creating a platform that could do small credit well in India using tech
  • Initially started with a focus on the small and medium enterprise segment (working capital financing seamlessly and quickly) 
  • Diversified into consumer financing as well over the years; today runs a diversified retail lending platform for both SMEs and consumers
  • Headquartered in Bangalore 
  • Lends across over 300 cities in India
  • Has disbursed over $1.2 billion to about half a million customers

The focus is really on two things:

  1. To provide access to financing
  2. Customer experience (intuitive, user-friendly process, and transparency) 

How is Capital Float coping with the Covid-19 crisis?

  • The industry has been going through many challenges, whether it is eKYC, liquidity of the IL&FS, etc., for around 1.5 years.
  • This setting has enabled us to be well-prepared for crises.

As soon as we started seeing this coming our way in late February and early March, we got into a warzone mode, and we did a few things:

  1. First, employee safety and health – we announced work-from-home protocols even before lockdown; infrastructure was set up with prior testing.
  2. The second was to ensure employees were comfortable and did not have to worry about day-to-day stuff – early salary payment for March 2019; COVID-19 insurance cover for employees and their dependents.

Besides these, we developed a playbook that focused on three or four things:

  1. How to ensure liquidity and sufficient cash flow
  2. How to look at cost and stop any extra cost outlays that are not warranted at this point
  3. How to look at risk more in terms of ongoing book and build up capacity for collections

We have also come up with exciting product features that we will be rolling out shortly. 

What happens with loans? 

For us, one of the programs that are seeing continued use is the partnership with Amazon, where we provide a line of credit for purchases. Historically, that has been used to purchase a wide variety of things. However, in the last few weeks, it has been primarily focused on purchasing essentials like gloves, masks, groceries, etc., on Amazon.

However, fundamentally, I think things are quite slow from a lending perspective – not just at Capital Float but across the sector. The critical question now on everyone’s mind is what the shape of the recovery looks like after the lockdown.

Any new product launches?

There are three things that we’ve already launched. 

  1. Health insurance, both COVID-19 and regular health insurance for all our users
  2. “Find a grocery store near you” real-time service
  3. Repurposing of existing product

A few more will be coming down the pipe soon, but we will update you once we are close to launching some of those.

How are you managing from a management and leadership perspective? 

  • It’s been about setting routines, creating the right check-ins, and checkpoints for our team – that’s number one.
  • I think the second thing is to communicate
  • Thirdly, just having some fun. One of the things you do lose in a virtual setting is that sense of camaraderie. That is important to early-stage companies, or rather growth-stage companies.

How have you been dealing with your investors in this crisis? How have they been for you? 

They have been very supportive. We were lucky enough – as you may have heard on the news a couple of days ago – that we were able to close a round of funding from our existing investors. So, at a time like this, that makes it all the more critical.

What would that be if there were one thing you’d want from regulators or the government?

I would say credit transmission as the lockdown gets lifted; the resuming of the credit flow to the last mile to SMEs and consumers is going to be the most critical aspect for the economy to recover. This should be done digitally and not physically. A digital loan is effectively a socially distanced loan, and it could be a game-changer for the economy to get back on its feet over the next few months.

To watch the full discussion, click here.