Unlocking India’s debt power_CredAvenue

Yubi was founded with a vision to redefine India’s debt markets – an arena that has tremendous potential to act as a GDP multiplier for the Indian economy yet is significantly underpenetrated. As a two-sided Marketplace for debt exchange, we operate to ensure we create a virtuous Network Effect. On our platform, any eligible entity – from small to large corporate, new economy company, rated or unrated company – with a rational need for debt can access the desired debt on time and at the right price point and terms. The marketplace also caters to the needs of investors – institutional or retail – helping them easily deploy funds into relevant debt instruments of their choice, at the best possible risk-adjusted returns and monitor the health of their investments portfolio. With the largest suite of debt products, we aim to create sufficient liquidity in the secondary debt market and ensure the investment corpus of institutions and individuals in the debt market increases over time. And all this is met digitally, end to end, to help all market participants integrate seamlessly and provide services to seekers of debt capital. Available with subtle configurations and personalisation features, these are the key components of Yubi Marketplace. 

As Yubi, we seek to solve several challenges that stand in the way of deepening the debt market. Applying data and tech-enabled decision making can help overcome these issues and propel a forward movement. 

Solving challenges for better credit 

Most borrowers find it difficult to access lenders, as most lenders look to serve only top-rated clients, resulting in a skewed borrower-investor ratio. Another big hurdle is the time taken to execute deals in the offline debt market world. Besides the availability of financers, the information on pricing is also quite opaque. Finally, there is little or no awareness of the variety of debt product options available, particularly to small and medium enterprises.

On the other hand, investors face a scarcity of information about companies that they want to invest in, which limits the ability of investors to evaluate newer credits. The lengthy deal execution timeline that is driven by manual evaluations proves to be another deterrent. We help them connect the dots on both sides of the debt market and arrive at a faster and more optimal decision making for both the investors and borrowers.

Managing the portfolio for investors is another hurdle. With our fulfilment module and tracking tools, investors can take tactical calls on their overall portfolio in terms of sectoral choices or assess their limits on the exposure to a particular sector or any other dimension based on which they want to invest.  Deepening the market from the investor’s point of view entails:

  1. Presenting them with a segment of creditworthy borrowers, who are curated and segmented on the platform and
  2. Making them easily discoverable and available in a more effortless manner via recommendations, for example
  3. Executing the transaction faster
  4. Tracking and monitoring the lifecycle of the deal and
  5. Managing the complete portfolio on the platform 

Honing deal discovery and debt efficiency 

The first step for building a two-sided marketplace is frictionless onboarding, which entails converging lenders and borrowers on a common platform, with easy-to-use features such as one-click onboarding, one-click deal creations and one-click repeat transactions.

The second step is discovery, which is one of the key functions of the marketplace where the two sides can discover each other easily, aided by reliable information made available on the Yubi  Marketplace. Discovery is aided via personalised recommendations powered by Data Science and ML algorithms like clustering, classification, collaborative filtering, OCR etc., that analyse hundreds of signals, helping borrowers and investors select and decide the financial products and facilities. These underlying signals that power these recommendations are based on the data gathered via public sources, data provided by clients and hundreds of inferred signals based on transactions that happen on the Yubi Marketplace.  Our ML algorithms also work in the domain of fraud detection and early warning signals that ensure that the debt deal listings on the Marketplace are thoroughly vetted, hence providing high quality, curated deals.

The purpose of this entire exercise brings us to the third step – driving deep engagement seamlessly. It is also a testament to the fact that while a platform like ours offers the most extensive breadth of products, we also provide the needed depth to recommend the next steps based on their current needs. The ultimate goal is to be able to build an engaging and customer-focused platform that is constantly learning and evolving to solve our customers’ needs for today and tomorrow.

Unlike in an e-commerce marketplace, order management on our platform takes place before the final money is paid. There are multiple steps in a debt deal’s lifecycle that vary according to financial products chosen, adding to the complexity.  The order management offered on Yubi Marketplace enables transparency between all parties involved in the deal and also helps in reducing the TAT at each step, hence also helping in closing the deals faster.

Finally, I’d like to touch upon the three ‘R’s of achieving debt efficiency we follow at Yubi: 

  • Reorder or Refinance – helping investors and debtors with recommendations aligned to their needs – where it makes sense to invest next or take another product to increase capital efficiency via reordering a top-up debt or refinancing it
  • Repay – giving timely suggestions on repaying the debt partially
  • Retire – closing a portion of the debt that is proving inefficient and moving on to more capital-efficient products 

To power this all, Yubi created a unified platform that meets all debt needs and helps borrowers take advantage of a streamlined debt Marketplace. Our relentless effort towards building a robust and scalable infrastructure that is highly accessible, available and reliable for our customers.

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Co-lending Industry and Product Insights

YubiCo.lend Annual Report FY 21-22

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