Business Loan Apps in India: Researched Insights to Enhance Customer Experience

This report serves as a primer for anyone wanting to gain insights into the delight drivers that lead to greater customer experience for the business loan app users in India. 

Business loan apps, Instant loan apps, Digital lending platforms, non-banking financial companies (NBFCs), FinTechs, and other stakeholders will benefit by understanding the customer experience of thousands of people who borrowed business loans using apps. 

What Is Covered In The Report?

1. Introduction and a brief overview of the Business Loan Apps in India
2. Analysis of the competitive landscape and profiles of major players operating in the market
3. Customer Conversations - Analysis of more than 3.5K Customer Conversations that will enable brands to deliver intelligent and seamless customer experiences. 
4. Top 5 Delight Drivers - What Delights A Loan Borrower While Using The Business Loan Apps In India? 
5. Analysis of each of the delight drivers 
6. Drill down into each of the delight drivers along with the key themes of discussions
7. Customer Verbatim - Hear What Loan App Users like and dislike about the apps 
8. Brand Equity - Detailed Insights into Ranking of brands based on each of the delight drivers. 

Why Buy This Report?

Traditional banks or lenders lend money to prime customers who have a great credit history. 

But Indian Fintech startups are on the rise that use digital technology to improve lending business loans to MSMEs that lack sufficient credit history by offering quick business loans with minimum hassles. 

Digital lenders, business loan apps, Instant loan apps, Digital lending platforms, non-banking financial companies (NBFCs), FinTechs, and other stakeholders should read this report to learn about how customer experience can be enhanced by understanding their delight drivers. 

1. Gain a better understanding of the drivers that delight a business loan app user in India 
2. Strategize marketing activities, entry into new markets, market expansion, and other business plans by understanding the factors driving growth in the market
3. Understand major competitors’ strengths and weaknesses and respond accordingly to benefit from the market

Overview of Loan Apps

Traditional banks are typically known to take a long time to process a business loan application. While other forms of lending such as money lenders are known to charge high-interest rates leaving a dire need for a middle ground. In this whole financial setup, business loan apps have emerged as a solution to provide instant business loans. Business Loan Apps use digital technology for a loan application, document verification, and loan disbursement, which thereby accelerates the entire loan process. Digital lenders have come of age as they have the advantage of speed and adaptability to assess and disburse loans faster. These loan apps offer a wide range of alternative lending options, such as working capital loans, lines of credit, startup loans, and merchant cash advances. 

Reason for the Growth of Loan Apps In India

Lack of access to finance has been cited time and again as a major bottleneck in the growth of Micro, Small & Medium Enterprises (MSME) in India. In the financial year 2020, the total number of MSMEs in India was more than 63 million. 

But the financial institutions are reluctant to grant loans to MSMEs due to some challenges from both the lenders’ and borrowers’ perspective:

• Lack of formal financial data for credit assessment
• Lack of typical business loans that suit an MSME 
• Lengthy process and a long turn-around-time for loan disbursement
• The requirement of collaterals/guarantees by traditional lenders
• Very high-interest rates
• Complex documentation and loan application procedures Potential market size

Business Loan Apps Potential Market Size

The digital lending market is forecasted to show accelerated growth between 2019 and 2025. The digital lending market in India is poised to grow from $110 billion in 2019 to $350 billion in 2023. This will improve the share of the digital lending market from 23% in 2018 to 48% by 2023. This will make the digital lending sector as the highest penetration sector by digital channels in India. The main reasons for the growth in MSMEs, startups, increasing internet and smartphone penetration, push towards digitization, and government reforms. The Reserve Bank of India (RBI) estimates the total addressable credit demand by the country's MSMEs at $490 billion.

Gap Analysis

In India, the credit demand by the MSMEs is at $490 billion according to The Reserve Bank of India (RBI). But sadly, the overall supply from formal sources stands at a scanty $192 billion. This huge credit gap of about $330 Billion suggests banks and traditional financial institutions are not able to serve this segment of borrowers due to reasons such as lack of credit history and lack of appropriate documents. This gap is leading to the rise of NBFCs and digital lending platforms that are taking this as a business opportunity. 

Importance of Customer Experience Management 

As finance products such as business loans are increasingly commoditized, digital lenders have realized that they need to provide a seamless and comfortable ‘customer experience’ to create competitive differentiation. From this report, lenders can assess what their customers are expecting from their products. By listening to their needs and demands, lenders can fine-tune their offerings to deliver a great customer experience. This report also helps lenders to learn what their competitors are strong at so that they can match up and surpass their competitors. Lenders can exactly pinpoint the areas where they are great and areas where their competition is doing better. 

Conclusion

India is home to a growing Fintech lending ecosystem. App-based business lending to MSMEs is witnessing continued interest from investors. There is a huge scope to scale up provided digital lenders understand what makes a borrower happy. For this merely looking at few complaints once a year will never be able to identify the real reason. 

With the help of this detailed research report, lenders can look at a holistic picture to arrive at a list of top delight drivers that customers are looking for in a loan app. 

• If you are an NBFC, FinTech, Business loan app, Instant loan app, Digital lending platform, or digital lender - Understand what it takes for a great customer experience and be more competitive. 
• If you are a Consultant, advise your clients in a more knowledgeable way. 
• And if you are an Investor, use this to make the right investment decision.