Yubi Co.Lend Product Update: July, 2022

In the most recent update, Yubi’s Co-lending team has addressed the key product gaps in the post-disbursal loan flow, and now enables investors and originators to partner and transact on our co-lending platform more efficiently. Here’s a deep dive into the product updates that make the Yubi Co.Lend platform more user friendly.  

Update 1: Collection Apportioning

Previously, when the loan amount was collected from the end borrower as a part of the repayment process, there was no way of apportioning the collected amount on the Yubi Co.Lend platform. Up till now, Originators used to share all the collection information of the end borrowers on the platform. However, this process required a lot of time and manual effort from the originators. Thus, increasing the overall collection and apportioning turnaround time. 

To solve this problem, the team at Yubi Co.Lend has built the collection apportioning logic on the platform. 

With this new update, 

• Originators can now send minimal collection information like Loan ID, Date of repayment, etc. and the platform will handle the collection appropriately;
• Originators can now configure the collection apportion strategy via a self-serve product setup journey;
• Originators can opt for IP (Interest first followed by the principal for every demand) apportioning strategy for a regular loan;
• Originators can define what classifies a loan as an NPA and configure IP (Interest first followed by the principal for every demand) apportioning strategy for NPA;
• Originators can opt for a prepayment strategy where they can send the updated repayment schedule later/or along with the collection;
• Originators will continue to send the charges breakup for every collection;
• Originators will continue to update the repayment schedule in case of a prepayment;
• Originators will continue to send the foreclosure flag and principal and interest waiver;
• Apportioning is applicable only for schedule validation and equated interest split. 

Update 2: Self-serve system to manage Razorpay failures

Yubi’s business team has been on war footing to quickly resolve growing concerns from investors who use Razorpay to disburse funds on Yubi’s co-lending platform. Investors using Razorpay for fund disbursal have recently been reporting ‘disbursement failure’ issues, hampering the quick and easy disbursal of funds into the beneficiary account.

Taking this up on priority, Yubi has made certain upgrades to the Yubi Co.Lend platform. Our self-serve model now allows investors to re-initiate disbursements in case of disbursement failures when using Razorpay.

As identified by the team, below are four top touchpoints or areas where there could possibly be issues that could trigger a disbursement failure. The Yubi Co.Lend platform is now equipped to source the errors from the Razorpay API and displays it within our UI framework as a failure reason next to such payout entries. The retry option has been initiated for all these instances:

1.Failure with Razorpay’s contact or fund account creation

Yubi Co.Lend’s User Interface (UI) will display the reason for failure from Razorpay’s API response. The failure to create a contact or fund account will prevent the investors from marking such loans as ‘ready for disbursement’ and they will continue to remain in the ‘Agreement Signed’ status. 

The latest update has introduced a ‘retry’ capability in the UI that will permit re-initiation within 30 minutes. Upon clicking the ‘retry’ option, fund account creation can be retried and established.

2.Payout initiation failure from investors’ and originators’ virtual account

If the initiation of funds to the pooled account fails, the reason will be captured from Razorpay’s API and displayed in the Yubi Co.Lend UI. 

If the fund initiation by the originator has failed, investors will be refunded, and if the fund initiation by the investor has failed, the originators will be refunded. The refund payout details will appear in the UI. The investors and originators may then retry within the next 30 minutes.

3. Reversal of payouts by investor and/or originator

At times, payouts from the investor-originator pooled accounts may be reversed. The reason for this is captured from Razorpay’s API response and displayed in the UI. Investors and/or originators can retry the action within 30 minutes.

4. Payout initiation failure to the end borrower from the pooled account

If the payouts from the investor-originator pooled accounts fail, the UI displays the reason for the failure captured from the API response, and refunds are initiated. The amount is refunded back to the investor’s and originator’s respective accounts from the pooled account.

The users can reinitiate the disbursal to the end borrower within the next 30 minutes.

That being said, if the disbursements are delayed due to a failure, the system will calculate and update the differential interest. Investors can also filter the loans based on the disbursement status.

5. Self-serve capability to drop loans at various stages of loan processing

It may seldom happen that investors may want to drop loan deals, especially ones where there has been no activity on the loans for 35 days or more. Whatever the investor’s reason to want to relinquish the funding deal, we understand that the process of dropping loans should be easy, hassle-free, and something that can be done within a few clicks.

Until now, the process for this on Yubi Co.Lend was complex and involved a lot of manual effort where the users’ requests to drop loans were entertained only via the offline mode. The process was possibly long-drawn with the investor having to raise tickets and then liaisoning with the tech and support teams for implementation.

With the latest update, investors will be able to drop loans at various stages of co-lending through an easy, self-serve model. Both investors and originators can now filter loans based on the age of the loan to identify inactive loan deals (older than 35 days). Based on this identification, they can take the call on whether to drop the loan or proceed. The latest update also facilitates filtering of loans and selecting multiple loans in various stages to drop them all at once, providing a reason for the same.

All loans dropped by the investors across the loan statuses will appear under the sub-queue, titled ‘Pending Drop Approval’. Following this, the originator will have the option of approving or rejecting the loan drop. If the originator approves dropping the loan, that particular loan will move under a sub-queue titled ‘Dropped’. Conversely, if the originator rejects dropping the loan, it moves back to the previous status, and the initial age and the turnaround time to process the loan will not get affected.

Update 3: Enhanced data security through document purge

As per the latest RBI norms, investors on co-lending platforms like Yubi are legally bound to ensure that the information or documents of the borrower are not stored on any third-party system once the loan is processed by the investor. This refers to the Personally Identifiable Information/ Sensitive Personal Data or Information (PII/SPDI) which includes sensitive, personal information of the borrower that has a possibility of misuse by third parties.

All borrower data on Yubi is stored 100% securely and safely. To further tighten the security around borrower personal data, Yubi has updated the systems to ensure that all Personally Identifiable Information/ Sensitive Personal Data or Information (PII/SPDI) data is purged from the co-lending platform based on the grace period, as agreed with the investor.

For enhanced clarity, investors will get the capability to denote their preference for document purge. This will allow them to select what documents to purge at what stage of disbursement, based on the grace days agreed by them.

When the originator adds a new document related to the borrower’s personal data, the investor will be allowed to set the purging preference for it. However, once the purging period has been set for a document, it cannot be changed. When the documents are purged from the system upon the exhaustion of the grace days, they won’t be visible to investors or originators thereafter.

Update 4: Addressing the collection validation issues 

There are end borrowers who make multiple installments as a part of their repayment schedule for loan(s). When a customer makes payments for multiple installments, there may be a delay in the settlement process, largely due to payment gateway settlement issues or a delay in the branch or NACH collections. 

As a result, the payments may get settled out of order. i.e., originators apportion the first received installment with the oldest unpaid or due installment. Therefore, if a customer pays the installment which has a due date prior to the previous collection’s due date, the system can reject the said collection. This blocks the originators from sharing collections with Yubi’s team. 

With the latest update, originators can share the collections with Yubi vis-a-vis the installments that are received in any order from the end borrower. Originators will now have the capability to flag products where they do not receive the collections on the same day when the customer has already paid the installments.