Making Loans User Friendly at Scale

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LoanTap’s Satyam Kumar’s cushy life

LoanTap’s Satyam Kumar enjoyed a happy life as a senior banking executive. As a high-ranking official at IndusInd Bank, he oversaw the development of several products and led large business lines. Satyam was part of the group of executives that saw opportunity unfold. Driving opportunity was the Indian economy that grew at a fast pace between the mid-2000s and the early 2010s.

Satyam did not contemplate leading a life outside the confines of his banking circles. He was in a senior position and was on track to be CEO. As he was on track to be CEO, entrepreneurship was the last thing on his mind.

Check out another Fintech Entrepreneur's Story: Nithin Kamath of Zerodha in Episode 2 of Season 1

However, several events by the mid-2010s made Satyam change his mind. He experienced a glass ceiling and felt that he had plateaued. Further, the growing Indian vocal and connected millennials, the black swan event of demonetization, and the startup wave pushed the market in a new direction. As large swathes of young Indian executives moved across cities, multiple opportunities opened up. Lending was one of the key opportunities.

India’s Savings and Loans Moment

India has for long enjoyed a great domestic savings rate. Indians relied on their own savings and insurance policies to take care of their rainy day needs. As millennials began crisscrossing the globe, they needed money to take care of their lifestyle needs.

These vocal and connected millennials hated products that were not user-friendly. Loans were one of them. Satyam saw an opening and founded LoanTap. JAM Trinity transforms governance, fintech.

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Users who wanted better products and the Indian Government’s Jan Dhan, Aadhaar and Mobile (JAM Trinity) greatly aided LoanTap’s Satyam Kumar and his push towards better digital products. Driven by the ablility to authenticate users electronically and the millions of young users online, LoanTap made a mega push. Backing this mega push was Satyam’s ability to raise funding on the back of his experience and the market opportunity.

This episode is full of insights on how LoanTap has grown at such a fast pace.

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​Episode Transcript

(Automated Transcript)

SUMMARY KEYWORDS

india, upi, happening, years, loan, ecosystem, lending, business, credit, product, build, creating, job, large, money, customer, bank, moment, started, month

SPEAKERS

Krishna Jonnakadla, Satyam Kumar

Satyam Kumar  00:00

idea and and not so much in with a with a genuine incentive for funding. So the funding are still happening on a hyper growth ecosystem in India, which, which is not very, very distributed. that essentially means is that it's happening happening in a consumer space, it is happening in landings and all landing was slightly easy also from auto to pick up on a funding because all the business in India has made essentially money in lending, right, so so, so, so, you know, very honest, if

00:31

I was a VC, I wouldn't have funded myself, like it has how bad the presentation was, you know, to build scale, you have to think sometimes I think too much of money restricts innovation, and that's the sad part. So

00:42

destiny finds you on the road that you take to avoid it. Whenever you get a seat on a rocket ship, you don't ask which we will see. He actually asked ourselves like too many questions in terms of how big can we get? It was very, very hard to explain what is UGC? If you want to implement something first 31 million to 10 million it will scale but again, you know, we had basic teams struggle, struggle, struggle, but every day was just learning, which was just amazing. Listen to

Krishna Jonnakadla  01:10

founders about their stories, and how they built their startups. Here on Maharaja of scale with me your host, Krishna Jonnakadla, co founder of mango mobile TV and Bob. Hey, everyone, this is your host Krishna Jonnakadla. From Mahara Joseph scale. Today we have an exciting guest Satyam from entity in FinTech, for a lot of us money actually is a Sanskrit saying called Hana mala, Madame Jaga, which means the whole world runs on money. And for those of us who don't have enough money, obviously, we borrowed to build a house to buy a car. And today, we have Satya, who's the founder and co founder and CEO of loan tab, who's enabling loans in a lot more easier way. Let's hear from him. Satyam, welcome to the show. Thank you. Thank you, Krishna. And Hi, everyone. Awesome. Tell us a little bit a little bit about yourself, Satya and what you're working on right now.

Satyam Kumar  02:18

so long that it has been five years of a journey now looks like more than a decade. And particularly in the backdrop of the kind of events both globally as well as in the in the micro financial environment that we have seen in the last three years. The events, which many of our seniors have not seen for hundreds of the years or so, you know, many of those stuffs are more like listed warning signals. So in this context, lending business we have always seen, it's a, it's about enabling, lending is never a product in itself. Money only enables you to buy an experience by a product or for our services. So all I have to do is that I have to enable happiness how to enable a particular need. So that's, that's what we love. So, there's something we have been doing for last 20 years and particularly into certain segments of India, which is fairly correct starboard society, it really gives your pleasure when you are able to help someone achieve a particular milestone or a particular goal or a particular need, which could be like as as basic as a medical need access to a medical facility, which could be as basic as as access to a good education, or which could be like, as, as, you know, flimsy and as good as having a mega wedding organized, and funded or having a foreign holidays tucked along with the family. So yeah, I mean, it gives an immense amount of pleasure to ensuring that people are able to achieve it. And in a way, the way we see lending is more like, you know, future cash flow discounting. So people are able to buy something today, which they would have to have to save for years and years to achieve something. So by the time you know, your age passes, you pass a particular milestone review, you will stop enjoying a particular kind of a car or a particular kind of a bike in a particular age, when you are able to actually buy it from your own savings. So it's more like, you know, you're discounting your future. And that's what we love doing.

Krishna Jonnakadla  04:35

Awesome. Awesome. You just, I just thought you mentioned marriage has an interesting premise. Although you said flimsy. The whole Indian economy seems to run on marriage. people's lives seem to run on marriage. I remember a scene in a Telugu film I speak Telugu that that's what my native mother dungarees. And there is this rich businessman. And he's got a, you know, as the cliche goes, he's got a beautiful daughter. There's a happy go lucky, young man who falls in love with her. And this guy asks him, he interviews him. He asked him, what's your plan? He tells him, I want to get married? And then what will you do after you get married? He tells him, you know, I think we'll have kids. What happens after you have kids? And his responses? Well, I think the kids will grow up, what happens after the, after the kids grow up? And his responses, I think the kids will get married? And what happens after the kids might get married? And then his question is his responses, they'll have kids? And finally, okay, then what happens and his responses, I don't think I'll exist after that. Actually,

Satyam Kumar  06:01

actually, Krishna married is something like with the core of many of the way we have been brought up in India, and, and so you know, this story of renovators having some setups, right. So so you know, you grow up, and you get married, you have kids, the kids grow up so so that at some point of time, you know, this, this whole gala affair around marriage is going to solve people becoming more and more educated, there, stop spending that kind of money on it. However, we are seeing a very different trend, and even the well educated class and all that it has only taken on new lead, where you have started looking at a destination weddings and all those, just forget for a minute Mahadev style weddings are not a whole new meaning.

Krishna Jonnakadla  06:53

They're somewhere I think, someone crept into the whole psyche. And everything that we do and did had got to do with this thing called Samadhi. And, and the funny thing is, as the day we severed the relationship between someone and what we actually did all sorts of fancy notions entered that. Right. But tell me a little bit about yourself, how did you end up end up in this, what's what's the backstory on that point,

Satyam Kumar  07:36

most of the story, which is still available, both globally and domestically, so, so not too many, coming from an agrarian ecosystem. So, my father being the first generation into a job and classically government job again, belonging to a small town officer towns in in faraway Bihar and growing up this was all it was getting a job okay. So that you can afford a family and the same story right. So, so, so, so, that's where we grew up, to get a job. Thankfully, I mean, life happens in in a different different way for some of us and, and for certain regions, we had to I personally got an opportunity to study in Delhi. And so, so, I left Bihar to go study in one of the best universities, which is given to us, the university and while graduating, we will mostly basically say that, you know, a lot of us is given or, or a lot of us are made by the society. So what we learn from the society, what we learn from our friends and our colleagues or classmates in a deadhead, that is what shifted us from from a normal job seeking individual to people who feel that they can make make a difference to the society and the first job was which which always remained in the mind is that if if getting job was the biggest task, can I get a job first, and then can I create jobs. So doing a startup or doing business was more about our ability to create jobs at any point of time, and that's something which kept on playing in the in the in the background and and then as, as life happened, I moved to one of the largest private sector bank in India work there on the on the lending side retailer set is a product category that will talk and we saw against styling people like us, who have who had seen the mobility in terms of coming from a smaller cities to a larger city urbanization was happening. The education side of the mobility was happening. The west side of the model of mobility was happening in India, while as a country we were moving from something like about 700 US dollar per capita income to about 2000 US dollar kind of a per capita. Besides all happening, when mass was migrating from, from, you know, low income to a middle income or, or higher middle income category. So we saw it up very closely by working in a retail asset, funding house loans, housing loans, and all people buying, buying houses, creating a wealth out of this, this category of asset and, and so so we saw it more like an emotional moment, and less like a business opportunity in the, in the domestic ecosystem. And yeah, as we kept on building our own understanding of the of the segments, at the same time, as a business, you also also get a strength that now you are at a level, even in the country like India, where the job safety is there to a degree by way of a skill set that you have built in a particular business and the fact that at some level, it's more like a pyramid structure. So like four or five of you are at all the senior position in the industry. So So you knew that, you know, at one level up or down, you will find that young so so people come from a middle class ecosystem, having a job, or having the security of, of landing a job is what leads you to do innovation. Whether it's from the IoT, whether it's from I am, you know, it's about the ecosystem that you have lined up in an ecosystem where you will find a job. And so you look for to innovate from there onwards. So, some of it happened for us at a middle age, when we had done enough of a banking, and we knew and a lot more about it, that I mean, we are in a secure ecosystem. And that is a time where we took the next leap and say that now let's create something about which which can support more claims many more colleagues, as well as friends from the ecosystem. And also people whom you wanted to employ on or whom you wanted to help buy a better product, or, or, or, you know, a different category of society, people who can come and join and work, which doesn't get hard, costed into the category of Institute's or the correct category of the of the qualifications and all. So, so, those are the stuff which which which was the driving factor, and wealth creation happened, you know, interface works, you know, usually chasing a larger objective or a larger passion, then we typically saw event in our career that will happen, so this is not something that, that it changes, it just happens.

Krishna Jonnakadla  12:39

You think so, well, we'll do something that actually happens just like that,

Satyam Kumar  12:44

it just happens. So, you know, again, in a classic Indian ecosystem, you always had a Saraswathi and a luxury and a conflict with Saraswathi Mm hmm. And what particularly we have seen happening is that you know, if you have a Saraswathi or if you have an education or skill sets, and all the wealth happens, which is which is the money happens.

Krishna Jonnakadla  13:05

Pretty interesting. In fact, I used to espouse that view. So, I want to go back to a couple of things that you said one aspect is job usually was the end goal and somewhere in your mind creating jobs for others and creating opportunities for the for others actually crept in how did that exactly happen? And did you always nurture an ambition to be an entrepreneur?

Satyam Kumar  13:35

Oh, yeah. So, as I said that entrepreneurship was more of a you know, how the from time to time society kept on giving us a better idea. So, so, in a growing up in the office in town, so, you never really imagined yourself to be entrepreneur and that to becoming an entrepreneur, which is a capital intensive, so, you know, becoming an entrepreneur India was always the word available, you have a capital level, you have the wealth. So, you know, right in the industrialists kits are the one who ever become an entrepreneur in India and not not the people coming from the applet societies or an outside ecosystem or outside close ecosystem. So so so it was never imagined. So like, we always used to imagine that, you know, you forget a couple of cars, you will do a small business and do all the stuff and then getting into a lending which is all about the money. So it was not never a part which was like you you design for it. It just happened that at one point of time when you do as well as your ecosystem, so like your biggest critic is, is always in your family, right? So your wife used to be always your biggest critic she knows so much about you that's essentially able to tell the truth about you. So when you spoke or when I spoke to her about my intention of creating this product, which looked to me like a super sexy product from a proper people who are a salaried, which we were like like all of us till that time. Okay. And then she said, Yeah, I think you should do it. Because, you know, in any case, it's a lending business, this all that you have done in your adult life, if you can't do that, you will not be able to do anything else. So that was a moment of truth or a validation. And that's how, you know, the business happened, or entrepreneurship happened to me otherwise, you know, because I was growing up well, in the corporate life. At the age of about 3637, I was heading the modular business, Senior Vice President with fourth fifth largest bank in India. So you know, after that, you know, you also realize that it's more like a waiting job, right. So, so your, your boss will become an MD or a CEO, and then you will move up. So you know, at that level, you wait for a cubicle to get vacated for you to move to the next level. And it's, it wasn't, it's no longer about the performance, or it's not like longer about what you bring to the table, it's only about that you have to manage business, you have to do it well. And then just wait for for for the next opportunity for us to move upward. So having said that, you know, we, we arrived there, and we were in a in a in a, in a decent place in a safe place. And then there was this streak of adventure in them. So I have been an adventure sports enthusiast, also family. So which is which, which is more about, you know, taking risk, but with all the right gears, it was it's never about, you know, taking unguarded risk. And the God at risk, for me was the market offering me even next developer job, like a CEO level of a job. So he said that it's not going to be too bad, even if I fail as an entrepreneur. So so you know, there is always on a mind that what will happen if I fail as an entrepreneur, so even if I fail as an entrepreneur, I'll have some certificate to show to my case that I had an appointment letter CEO. So you know, it's like a validation that if I go back to the same village, it will not be an empty handed, right, so I'll have something to show. So it was a mix of, you know, trying to create the safety net, and then taking the plunge or taking the next leap.

Krishna Jonnakadla  17:17

That's amazing. I'll come to that village and the adventure sports in a second. I'm, like, fascinated by this the first time, maybe somebody who have in most people's minds, bankers are people who are associated with the world of finance. Other than the Wall Street hedge fund brokers who seem to lead colorful lives, everybody else is supposed to really lead a boring life. Right. So, but I, but I'll come to the let's talk about the I think it's the first time we've had any guest on the show talk about a progressive realization that the market is changing, there's an opportunity, and therefore entrepreneurship should be pursued. And one of and I think an iconic film, that sort of, is a sign of the times is the word. Have you watched the word? Where? Many, many times Yeah, I, I, in my mind, not to insult any Bollywood fans. But in my mind, the word is a more seminal film, then surely, surely, it's just all just noise and bells and whistles, but the word has got an undercurrent, it's an indication of the times that somebody who aspired to a higher life had nothing to do to to look for, but actually, you know, take that other path. It was a sign of the times, and like you said, If you didn't have capital, there's nothing you could do. And the only ones that had capital, were the ones that had jockeyed into positions of power and business, and politics. You know, where before the rules of the game were actually drawn? And, and if you look, look at it today, I think all of us can get carried away by the 10,000 Indian startups or 10,000, whatever India has the third largest startup ecosystem in the world, but, but I think barring a handful of sectors, I think the scene is changing, but it's not changing really, that well. In FinTech itself, the lending business that you're a part of, imagine the savings and loans crisis that happened in the early 80s. In the US, they were all the cooperative societies in India, which are actually the credit unions in the US, which is a direct parallel, which has all members, they've all contributed. And these people are actually lending And then there, the underwriting guidelines are a lot more less stringent than your mainstream banks. It feels like we are going through a mini version of the savings and loans crisis in India. But But if you see the largest sectors take power, infrastructure, mining, transportation, communications, even in communication, when you look at Mass Media, all of them still have the same legacy houses. Right? Absolutely. And it is, it seems like we've entered an era of the internet, whereby, in the internet, it's mostly a zero sum game, the one that gets to become the largest because of network effects becomes so large, that another 3040 years it becomes unless something happens really drastically that. So, if you take Facebook as an example, it is who can think of actually dislodging Facebook from its dominant position, right. And if we if we take the Indian media houses as an example, outside of Times of India, its you really have to struggle to name the second largest at least in English, maybe you have dainik Bhaskar and then some of them on the in the Hindi in the Hindi interline. But otherwise, all of these people have got into that power. And capital is still hard to come by, in those places. So and we have enough regulation that is that prevents creative destruction from happening. If and if anything, it is mostly creativity, destruction, as opposed to creative destruction. So, but FinTech funnily enough, seems to be in a whole league of its own, I think, the payment innovation that national payments Corporation of India has unleashed, I think, and I'm just I'm just personally trying waiting to see UPI happen on credit. And the day that happens, you know, I think we are going to see a whole host of innovation get unleashed up. So it's, it's interesting that your wife's input said, You've been doing lending your whole life. And you've seen the so there are two factors. One is the ecosystem right now seems like there's an opportunity to be on to be an entrepreneur. And even if you did take that break, and then come back out a CEO job would be waiting for you. So you eat like a typical banker, you saw this, like an almost no risk scenario, if I put it that way, right. Absolutely. But But I'm, but I'm intrigued. Go into a little more about that starting phase, you started before the D monetization event happened, did you? And then, how long was that? Was it before the monetization happened? So what 18 month report? Okay. Okay. All right. Talk about those initial days. And then it is one thing to have institutions institutional backing, because in India, largely distribution is still a legacy game. While while it, I think it is changing, but the lack of data, the lack of identity, information, the lack of information about trust scores, and stuff like that, actually makes it challenging. So what exactly in addition to these macro indicators, you spoke about that? On the personal front? You know, your risk would be limited, but otherwise the country itself was changing, so to speak a little more about those initial beginnings. And what was the product like? And how did it take off?

Satyam Kumar  24:05

Yeah, sure. So, Krishna, let me also go back a moment more and just try to duplicate the online what you said about UPI in credit, Union about, you know, stuffs that you were mentioning about? Yeah, yeah. So, so about the funding or, or other businesses, which doesn't get funded in India. And to be honest, you know, we regularly meet these kind of enterpreneur entrepreneurs or researchers who have built a great graph or a great path breaking research which they have done even on a on a basic fundamental stops, like you know, health care and all those projects doesn't get funded or it just gets easily copied in the name of, you know, dangling some funding opportunity and then by the time you are only looking for to copy it out. by a larger corporates in active pursuit of the business idea and and not so much in with a with a genuine incentive for funding sources of funding are still happening on a hyper growth ecosystem in India, which, which is not very well suited. that essentially means that it's happening in a consumer space it is happening in Europe, landings and all that lending was slightly easy also from auto to pick up on a funding because all the business in India has made essentially money in lending, right, so so so, so, you know, finance is a critical part of any business, right, whether for a day or whether as a credit cycle or as a builder discounting or as a data day or a credit late, it's definitely a part of, of running an economy. So, so this is, because this has been a fundamental level. And as I mentioned earlier, in the conversation, that internet as a country, we are great stuff. So like However, our personal debt to GDP ratio is about 18% 17 to 18%, which is the at 60%. In China, and countries like us, it's at a abnormally high rate, like 110% kind of stuff, also. So credit to funding and credit was not, not our area, like rocket science, which which people started doing it. But I haven't said that. Are the good businesses struggling? Because they are, they're hard to build incremental build up and not like a hyper growth ecosystem? The answer is yes. And we feel pained by seeing those good entrepreneurs not surrendering to the market conditions and not being able to pick up the money to build it. That's that was on the on the funding ecosystem itself on coming back on the UPI in a credit? Yeah, I think there's a lot to talk about it. So so let's, let's park it in the moment and we'll, we'll come back about it. And because we see it happening, so, so, we have to have something to talk about it. About the early days of loan tap itself. So yeah, has been very challenging, has been very challenging, particularly about coming from a banker mindset where you're trying to say that there has to be a risk aversion, the money has to be collected, it is not about the GMB is not about the burning. So, like we are profitable for last year. So, like, after the first two years, we turn profitable, very few FinTech other than where we want to you know, have been profitable all this while COVID working in the largest funded ones, and all even the recent fight dr HP which is for the listing and all even in India, startups are claiming that we will not get on become profitable or we do not know at what point and in what methodology will be profitable, but there is a large business, but building so, so, so, we are going for an IPO. So, so profitability, risk aversion, and all was more about being conscious about it, both the part of banker upbringing and all So, we were not as we were going into a demand or we we chose the sectors also very carefully of those these sectors were not like you know, white patches in the economy, it was incrementally better. So, like we were offering a product to the salad people salad people are getting a good production, I mean, they were getting a credit in India, particularly to the large cities where we started right and for us, it was the quality of the money or or you know, the quality of the relationship between the institution and the individual, okay. So, so, so, so, that is what we are attempting to solve. So, since you are not really attempting to solve by an unknown territory, and all so so, so that didn't really So, some of these events actually come as a as a blessing in an in disguise for us. So, select that entire market was funding msme segment in India or other credit providers who were doing an msme segment in India, looking at about 60 million SMEs and the credit is available only for the handful of a few and almost all those numbers were there, we chose to be a salad dominated dominated or a consumer dominated segment where we say that will give a good product to bankable people. And we will not really create a credit product where we do not understand how to underwrite so underwriting event core to us, that technology was more about a better product curriculum creation, better user experience, okay. And it was less about a disruption okay. So, so, our technology was going about going closer to the customer and not about you know, going to a very new segment of a customer which is not captured by a traditional lending institutions. So we are incrementally been better. So since you are implemented Better this events look like you know the moment that you have been waiting for because when demand happened and our msme portfolio and for a toss okay and our entire portfolio was on a salaried side and a consumer people like any of us you are meeting on the side. So, that's to prove which which which proved to two points which we always say that in a learning with us we have a two kinds of risk. One is you run a risk on the business and the second you have a macro economy risk on the cycle at cyclical at whether it's existing on an individual side as long as the country is growing at about 7% GDP 5% GDP growth and all the job losses are not as Stark as or by design of the social structure also, we do not boast that we have sagged that 10% of our employees or 20% of them from basically when you when you know the retrenchment and all happens in a very quiet way so that they get accommodated in some other organization people get a long rope in India. So, the cash flows was there you know, the the nature of cash flow might change, but the people's cash flow doesn't get disrupted in a salad side the way it gets disrupted in a business side which which could be not a doing of the business itself, okay, which could be a doing of the the larger call which has been taken in economy or some other conditions including something like a COVID like a pandemic. So, so, you had demonetisation you also had some lesser known event like the courts going after and saying that you know, you will not have a liquor shops you because on on a basis of a cash flow you you discount. So, you said that the runo liquor shop or a liquor serving restaurant, near the highway, okay, and this this entire episode ran for almost like what seven to eight months before him got settled that some kind of stuff will be allowed or people took the losses and people move the move ahead. So, these events have been happening more frequently in emerging country like India, where the rules and regulations so that the situation is not as mature as it is in a in a far developed world. So, so, the the regulation is also evolving, the sector has its own challenges, sometimes from a dumping in trading segment from outside export restrictions, import restrictions, you have all kinds of variations, which which keeps on coming in. So, we decided that we will carry on I mean, our ability on a small balance sheet was to have us less at risk. So, we decided to stick to a more seen and and validated salvage segment by creating a better product. So since the risk appetite was well defined, we were never really like so so it was the trouble was maybe like you know, you had even before or after demonetisation you had an island Fs Okay, which was like so, as I was mentioning, you had you had the biggest banking crisis in the order other financial institutions crisis in India, in between 2018 to now, okay, when you had large nbf seas going down, you had a couple of banks going down, including those credit, cooperative banks and all and a large bank like a US Bank and all which which almost went through the entire network erosion report got funded again by an SBA system. So we saw it so it came more like a blessing because the market was expecting you to go buzzer and just lend lend, because people are looking for to money. And we say that hey, it's not no longer only about a lending is about potentially lending is what consciously the money has to come back for for a business model to establish itself. So, that way, less moments of anxieties, anxieties to us came more from the external world less from the business itself, when I say external world, it is about you know, people in the ecosystem coming and asking you the same question, how are you going to handle now that demonetisation is there how are you going to handle now that COVID is there are a moratorium request is there on this thing is there that says so internally, system wise, were more comfortable, but it was more about answering in the global anxiety is like you need to have a runway for two years, you don't know whether the second wave will come, third wave will come how long the pandemic will go and see we have gone through those anxieties. But as far as the business building itself is concerned, we kept from getting good support from the capital or the equity market from time to time and not much complaint from from the debt ecosystem or or borrowing ecosystem because we blend equity and a debt to lend to an we are our own balance sheet lender. Besides now, making it available for for other lending partner also to come and support and build the product on the platform. We essentially have been building our own balance sheet to demonstrate that how the business could be done profitability or profitability with or without the cost Another credit loss structure. So not too many moments of anxieties. But yeah, I mean, you had a lot to answer.

Krishna Jonnakadla  35:08

That's interesting, I, what I touched upon the, the prudence angle in a bit, but let's unpack this better product. So, you, especially for the salary, salary class, because you have documentation, you have several scores, you have form 16, you have income tax returns, for several years you possibly have? Well, for people who have all of this, they obviously have years of banking relationships, which means for somebody who's doing an making an underwriting decision, all they need to do is they need to look at all of this, whether it is available, immediately in the form of easy data, which is right now, or if you had to pull a few things, that's a separate aspect altogether. But you were, as you yourself, rightly said, you were going after possibly a red ocean, in, you know, in the blue ocean theory pilots, and you are trying to make the experience better. So unpack that a little more. Because you've been in icsi, you've been in industry, both very, at least, you know, as an outsider, I've been a icsi customer for a very long time, please organization's sort of technology and industry in likely so as well, because that's the best way for them to differentiate themselves. So, they go after innovation. So, what is it that you saw as something that you could do differently and you could do better and elaborate unpack that better product angle A little

Satyam Kumar  36:52

short. So, if we look at the banks or the larger institutions, that are clauses are more made to support the existing system and processes Okay, as a as a starting line, that I would want to convey in in startup ecosystem or when you start from a technology and a mind technology is challenge to do something which is unimaginable otherwise, so so there are technologies adopted, here technology challenged that hey, via we can do this from a technology or whether technology cannot improve improve to this level. So, you know, there's one is adoption of technology, the other is a challenge in the technology itself, that, that you create a newer boundary for the technology. So the startup was more water during the challenge in the technology itself. Now, they're all it has happened in and how does it differ from from from a cutting edge technology, the banks being at the cutting edge, and from the from the technology itself, taking over the forming the core of the customer experience or the or the product. So, if we look at the lending, retail in London for sale, it has a four key arms to it or a key angles with which you engage or differentiate, one is a distribution itself. So, when we talk about distribution, then the distribution is what now, how the distribution has moved to face that when I started lending in 2016, then only about 25 to 30% of the loan was originating and happening digitally, in the in the Indian ecosystem. Now, the segment that I cater to 76% of the loans are originated and completed digitally without any human intervention in the sense that you don't have a people going and meeting and all the staff associates the district distribution was changing. And the people's behavioral aspect was changing because the new borrowers the millennials were coming who were digitally native, and then it did taste for a banker saying that I will not foreclose alone I will pre close the loan in India foreclosure is different as in us so I will not pre close the loan because the there is a pre closer charges of 4% or for a one year you can't be close and you know creating those kinds of exit boundaries on a customer associates arbitrary exit bond bond is created. So the behavior any we had a test for this kind of a banking where you when you pull out a bank statement, you have to walk into a bank request for a for Statement of Account and they will say that I'll send you by mail, okay not even give it to you. And then they'll say that I'll give you on a on a mail or you're going to log into a call center or a customer care and a call center is something which which will take about seven to eight minutes to reach to the right setting. So you know the generation had a detest for for that kind of a banking and many of the fintechs has captured that it has captured that in full Including the the UPI moments in the payment sites. So, the distribution was moving in our favor. So, we do that distribution will support second was product design itself. So, so, a tech was about now we can call it fractionalization of a credit, but we started sharing as a Sasha moment in lending in India right. So, so, so, when when your bank you know you get a personal loan on a personal loan comes in a size like a minimum loan amount this much maximum loan amount this much this is the tenure you cannot prepay you cannot pre close the loan This is the way it is the fee is the only arm on which each of us were negotiating as a customer was about what is the rate what is the fee and what is the quantum of the loan. Now, you imagine a situation if you're a self employed guy and there are a business in India the instruments or the number of credit products which you have available is unimaginable, you have a cc limit you have an overdraft limit, you have an export credit you have a disc credit for every purpose you have a new design whereas, for a salaried people here this is the loan which is available, take it or leave it okay. So, against that kind of product approach, we say that we'll do a variation and the place to do variation was for us on the way customer wants to repay the loan, it was not about taking the loan, it is how he wants to repeat. So, it was about maintaining the relationship with the customer. So, we made something like a EMI free loan right. So, so, EMI free loan in it's like a installment best known, but the fixed installment is only the interest part okay like a minimum payment charges on a credit card okay. And the So, that was the issue and and the principle payment you can pull it prepay based on when you get a bonus you get an incentive you get some other monies and all So, you know traditional imagination is that a salaried guys gets the same money and has the same expenses every month the normal or the way we looked at from 2004 onwards is that enter it it system in it ideas ecosystem in India runs on a quarterly variable pay which is very different amount getting credited in your bank account at the end of the quarter okay as against the same amount that is credited every month okay. Same was on on the bonus and incentives for for a mid to junior level employees in the banking systems and all and then you saw the similar stuff happening even on the expense side. So, so, you had like Diwali expenses, you had a difference for some time you wanted to have more money with you not pay the same kind of installment. So, you know this cash flow variation is what we attended to okay by giving an overdraft facility by giving which was not offered to salaried. So, we we started giving an overdraft facility to Sally. So that giving an EMI free having a step by step of repayment plan. So like your early stage of her career, you do a lower installment next year you will get an increment so you do our normal installment. And then you will get a better promotions and also you do an accelerated repayments and all. So we created these kind of variations, along with removing the hurdle around prepayments relationships Next, take off the money and all this stuff. So this will be attended to the product side of it. So you had a distribution attended, you have a product attended turnaround time, of course, we always knew that will beat the banks or other institutions hands down. So there was no questions around that time itself. The fourth part is of course, the cost of capital. And cost of capital we always knew will take time to solve. So we did not say that will solve the capital problem. First, we say that I'll reduce the operating cost first. Okay, so because you know, you have more capital, if you spend more in managing those businesses, then it eats into your bottom line, right so so I managed the the technology also now allowed me to manage the operating cost. And and so instead of solving the cost of capital, which we thought that rating and all it will take time, we saw the operating part of it.

Krishna Jonnakadla  44:20

That's pretty interesting. So for end user, what it essentially meant was I had a product which had little to no frustration associated with it. Right. So what I'm and I and I, I think I can relate to that. I still remember with icescr there was an auto loan, a car loan, and we wanted to prepay it in the fifth year in spite of making on time payments for four straight four straight years. In the fifth year there. There were pre closure charges and I'm a chartered account. And I'm a very quiet, I'm a man of numbers. So there was a certain degree of anger in me, because it was virtually like, whatever remaining interest income accrued for that almost maybe a small discounting factor was applied to it. And that was levied as a pre closure charge. So I can understand that. So essentially, loans with other than the repayment string, no other strings attached. And all of it all of it was digital. So because a lot of expenditure goes in offline, you have feet on the street, you have people possibly verifying. So therefore, you said, I will bring down the cost of distribution, which is the operating costs, there are two, there are two parts. There's the ongoing variable cost of originating the loan, that's what drove and then there is the input capital cost. So the input capital cost is not something that you can change overnight. It's not that much in your control, there are a lot of macroeconomic factors and possibly a whole host of other things as well. And then you have the real things that you can actually control are your operating costs, which is your way of so so your so your rationalization was that we know the frustrations that people have with these traditional loan products, even if they are from, let's say, technologically, technologically savvy institutions. But technology was me nearly used as a convenience angle as opposed to really giving people products that can be configurable to their needs. So that was that that's interesting. So I, well, the world of finances. Take, if you look at the world of American Finance itself, where all sorts of exotic instruments are born on a daily basis. It is it is not surprising, that, you know, there's opportunities, I'm sure this is just the tip of the iceberg in the possibilities that exist. I still remember I think about 18 years ago, I, my father was purchasing a car. And I always had this entrepreneurial desire in me, although I was working for a very well established consulting organization, at a reasonable salary for those times. I still didn't want a multi year loan. I said, I don't want a five year loan. I want and I don't want to pay interest. Tell me what I can get. And funnily enough at that point in time, I think Citibank had an option of a one year 12 month EMI, though the EMI was high, because it was just one year. And since there was no, there was no interest, there was significantly no possibility of default. So So if the default, penalties were very, very high, I actually accepted it. Because for me, that fit very well, the one year time horizon was perfect. And it the amount that they I wanted covered the money that my dad could not cover, I got it covered. So I can relate to the real convenience in the configuration of the product, really bringing happiness to the borrower, which is, which is the opportunity that you actually saw. Amazing. So going to the user acquisition side of it. I think. So did you launch an app? How did you? How did you begin? How did you acquire your initial customers? How long was it before you got your first use the first customer talk about those aspects?

Satyam Kumar  48:59

Yeah, so from the time that we started, conceiving the business, the biggest roadblock was more about getting the regulatory approval, because lending in India is is regulated. And it took us about four months to five months to get all compliance done, including the required declarations in the in the media, and also stuff. And document it was done within up from the next day we started doing because that is what we had prepared for the first four or five months. And while preparing for it. Some of us were lucky to have a tech CTO or a co founder most of that has been one of the most challenging jobs in India getting getting a co founder who understand the technology or who can code so so it's beyond understanding. It's a it's a it's a cherry on the top of an ice cream if you get a cream if you get a guy who can code also Okay. And then we actually evaluated multiple technologies which was available in the ecosystem and we realized Let's have a look at clauses this essentially is trying to cater to the ways the band had asked them to make, to make. So we actually had to write a code from scratch, okay, between between one guiding and the other one implementing it. And we've got it up and running surprisingly important months that we didn't have to do you want to excel, unlike what you would have wanted to do in a startup that, hey, let's start from Excel. And then we will migrate to a system. The first one itself was broken on the system. So so it was a five month preparation, essentially, because of the regulatory requirements with which you're required. And then once we moved here, it was an absolute, no superhighway, because the products were very unique. And and while my competition was advertising that I will give a loan at 11%, somebody, again, send somebody a 12%, we were advertising on on our Google and social media that I'll make the last installment will lower by 40%, or 50%. So it was about making those conveniences sell. And so so so you know, getting a search or, or, or even update ecosystem didn't really burn, I was still operating within a given domain of what 2% kind of an acquisition cost, if not less. So. So that worked for us. And yeah, we started from the web version, because we were focusing more and more on creating the backend, because we also wanted a certain set of information from the customer on the like suffer bank statement. And all by there was never that will be able to be we wanted to scrap or we wanted to pick up our data, which is illegal or which could be used because we have seen enough cases in China and not in India, where we have seen in a case in China, where the personal informations were misused for by the institutions of the individuals who went into the lending business. So we were absolutely careful about that. So So we started with a version, we had our app in another eight months, nine months down the line, where it was doing fine. So there was also resistance by app bricks, that's doing as fine. But you know, when we did an app, then we realized that it just doubles up. So it's not as if you are catering to the same, you know, same audience, it brings a very different set of audience or a user base itself. So we had an app and we also experimented with making more like a conversational application on WhatsApp. So you know, you can make that loan application on WhatsApp, now imagine use filling a 20 minute form on a bank's website as doing the entire loan application on WhatsApp at any point of time. So so that's what was the focus on the application side and the winner nothing to complain so far, and beyond that, we had to migrate. Because this you know, this was on property, but as a business de risking you always try to have what else should be done. And once he was clear that we didn't want it to go back to the traditional distribution mechanism, because that was a losing game, which we decided in the beginning. So we started working with large data companies as a partner socio. So we said that, hey, I don't mind being like a product provider on a platform even if the plot platform is someone who is doing a travel or a platform is someone who is doing a groceries and all kind of a site they anyway sell other products will lend themselves alone so so we've become an integral part into the embedded finance and all without actually talking about it. So our sense was more about the data that you know, are getting validated data, which is which has a higher degree of fraud prevention or you know, getting a quality data and, and then started working with a partner so so we have leading the category leading partners from a travel from cross three segments from electric tubular manufactures, which were to kind of fancy for last three, four years, where we have those partners we generate transactions in orbignya enable transactions there, okay, in terms of providing credit there, so so so we have a partnership and our own properties like you know, SEO marketplace cannot go the engines running so so that's how we have been working on the distribution side and keeping it in at least 150 to 200 pips lower than our competition, both traditional as well as a new edge

Krishna Jonnakadla  54:30

what, how many days to first loan and then how many days to the first 1000 loans?

Satyam Kumar  54:38

So yeah, I think there was much faster because the first month I would say, as I said, first loan if you want to say the development phase and all was almost five months, and then the 1000 loans was the next few months for you caught up with a Diwali season you can be saved. So so you know, next 100 days As you have started talking, that kind of number, so so it hasn't really fast in terms of overall volume wise which we'll see which which we typically see in a year and by then, you know the first year you ended at 10 00 am and the next year you ended up with a 60% of a US So, so, you know, it was like six six in terms of ATM growth in year two,

Krishna Jonnakadla  55:23

what are the numbers look like today in terms of number of borrowers all of that kind of numbers. So, now,

Satyam Kumar  55:28

we have cumulatively we have done about in domestic currency, we have done 700 crore kind of loans, which is what 95 million US crime number of users thought is at about two and a half lakhs, but the number of loans are still 35,000 and the active active ATM is about 55 55 million US times about 383 80 crore

55:56

interesting.

Krishna Jonnakadla  55:57

And I suppose this is just the beginning the way you see it, because now we want at least a set of possibilities where because we are seeing this happen, even in insure tech, people are taking a look at policies that have a great deal of hidden things in them. Although in loans, it is sort of immediately palpable it's tangible because the moment you pay your first EMI, you know but in in but in insurance on the claim is made either for property and casualty insurance or the day the final payment for life insurance, or the first payment comes up in endowment insurance, the real impact of that policy doesn't actually hit. So the hidden terms and conditions are the so called fine print as we as we call it. So now that you've transferred, I've said scratched the surface of transforming how loans are sold. Where are you headed next? What do you see as the next possibilities

Satyam Kumar  57:02

what also helped us Krishna is that what we got initial four or five months to build a catalogue or build a company before going for the first product in the market. similar event happened last year for us during the COVID when for a long time you had uncertainity both on the global market and uncertainty as well as regulatory uncertainty is also because you are dealing with moratoriums, you are distressed and dealing with different configurations which was coming every other day. So, that gives us a time to just sit back and work more and more on our technology and on the user side and and with thoughts about it. So, so now, we are about you know bringing the entire banking experience on a card. So So convenience which we started from an overdraft Okay, we have taken it all the way to a plastics, plastic in India is still like highly under penetrated you have about 16 million plastics and active customers wise, it's less than what 35 million. Because most of the people are too bad user or a T card users kind of stuff. So the plastic is not there. At the same time uses are like a compulsory so select today, in our current environment, you can't be mobile, you can book a railway ticket, if you do not have an eight UPI payment mechanism or you have plastic in your hand. So so it's like it becomes so basic in contactless system where the government itself is not allowing a ticketing counter to open for a railway. So so that makes that you know, the need for a plastic is not only for our for credit, but need for plastic is also about just doing the transaction itself, you can do a transaction without having a plastic or without a UPI handle and that kind of stuff. So we took this time to build some of this new product categories. And that essentially means both going going wide, as well as now continue going deep on the partnership stacks that we had built. So the demand side partnership is what we built in the first two, three years. on the supply side partnerships. Also we've moved beyond our own balance sheet capacity by bringing in the pole lenders. So the whole lending regulations in India was re dusted and refurbished and given to us at what November last year. And after that you had banks and larger financial institutions looking for to FinTech partners, because you know, they can't open a branch, they can't open a you know, they can't go back to the same cash world at the same time, there was an overhang of secondary when a third wave so they will always looking forward to those situations. That what if your branch is closed, will you still be able to do a business so so then, FinTech partnerships around a pole lending and all our games, but what about seven eight new suppliers on the platform? So having solved the supply side disassembly, and haven't created the engine for the growth on the partnership side. Now it's only about, you know, it's like, you know, creating a good foundation. And now looking for to quickly do the casting of the entire structure. So that we compare it like growing bamboo, right, so so bamboo for a long time, it's seen only under the ground, you can't see it. And the moment it's above the ground, it just, it catches a couple of inches every month.

Krishna Jonnakadla  1:00:31

So what does that mean for your products.

Satyam Kumar  1:00:36

So if you associate a new product for the end users, it becomes like, you know, the single place both it's a safe, okay? It gives you a kind of a cost effective solution as an as a credit card or a credit card over overdue kind of a situation. And the third thing, also, it allows you some pot of money, if you want to be invested into the safer to the medium safer instrument, so you got a very few money lying with the institution, it doesn't go waste, right? So so it doesn't lie. Like it's not like a pot of money, like a wallet, where you don't make an interest, this money on the card remains where you you get an interest, if you need a credit. So if you look at us two standard salad in the in the like, mid categories, which we are not self serving so much in a blue collar category, the beginning of the month, you have a salary getting credited to you or the end of the month, your credit credited to you and 1516 days down the line, it start depleting. So the point is that you're not till till the time it's your money, you are getting an interest. And the moment the money is is depleting on your account, you start dipping into the credit, right, so So on one side, you you make an interest income. On the other side, if there's a need, you have an interest cost, but everything happens on a single card, it doesn't happen in multiple places that hey, for this, I have to borrow from the app and then I have to take it to my in my in my bank account or to my debit card or my plastic. And from there, I have to use it. So so everything happens at one single place, you just don't have to look out. Interesting. So I

Krishna Jonnakadla  1:02:13

think kravet is is the term being used for that, where both happen on the same. I've, I personally felt, I don't know a lot of people outside of the ecosystem or even FinTech don't maybe don't pay attention to it. While Donald Trump was US president. Visa and MasterCard applied a lot of pressure. And added to that the three credit unions Experian TransUnion, and Equifax applied a lot of pressure on the Indian government to actually allow them to operate. And there was a great deal of pressure, I think, to also make UPI subservient to some of their infrastructure, because while reserved master obviously they operate globally, they they are fantastic institutions, they've definitely built up fraud signatures, usage, signatures, all that kind of stuff. But at its core, essentially, there is a lending partner or an underwriting bank. And then there is an issuing bank and Visa and MasterCard essentially accessing that saying, okay, x person is eligible for $10,000. Now, this particular number, which is tokenized, essentially, the 16 digit card number is actually tokenized. And, because it is tokenized, which is why you need that magstripe on that on that card, what UPI has done because and you need that because you do not have two factor authentication in the US, or globally at least right while you Europe still has one factor authentication. And the smart chip in the card essentially, possibly is one additional one minutes not really looked that way. But what the UPI protocol has essentially done is virtually made. What is representative against bank balance can be representative against a credit limit. I mean, what what stops that from happening, right? All of a sudden you possibly have inverted and even taken away the need to tokenize a number. So therefore, your large scale hacking of credit card numbers, large scale hacking of debit card numbers possibly go with but the US system also has a significant amount of advantages because it's the way that entire system they're built is literally for frictionless. So you have a lot of subscription payments you have a lot of straight through processing you have a lot of even your bank accounts can be debited many times with just basic information without your knowledge. But the beauty of it the reason that exists is because your fraud infrastructure, your liability infrastructure, a whole host of them, your bankruptcy laws, a whole there's a whole ecosystem that's built around it. And in India because your legal ecosystem, your legal framework, your civil criminal judicial bankruptcy law framework, although I think there are a lot of steps being taken in the right direction, haven't been simple, haven't yet caught up. And I don't know how long they will take possibly, we'll have products that actually nullify, essentially, the need to make any of that happened now that we have technology to make a lot of that happen. So I, when do you think we'll see up I happen on credit, is it already.

Satyam Kumar  1:05:46

So it's already in discussion with the regulators. regulators in India typically takes one step at a time. So unlike many other countries, regulation in India does a far better job, it might look like a slow, but it doesn't come up later, like like our neighboring countries and kills the business. So you know, it, it only allows you to incrementally experiment, and then then goes fully both to the global parallels domestic possibilities, and then it's allowed. So like the some of the stuffs, which has recently been allowed on a UPI is like subscription services, where you can debit multiple times in a month or on an app next optional, which has allowed many of the credits to flow seamlessly, on a credit side, what better is also happening is, you know, the entire msme system is getting opened through a network called Open, which is, again, I spirit is working on it, where you have lots of the gsts and all kinds of information is available, including tra, DS energy M, which has been opened by the government. So no tech side, I think I would still say that the innovations are are at the grassroot grassroots level in innovations are far superior in the Indian ecosystem, when are controlled because here, the government or the larger ecosystems are creating an infrastructure on which multiple unicorns can run on. So so the infrastructure creation is one of the biggest things which has been done in India, as against many other countries, which is left up to the private sector. So so that's been specifically to UPI, providing credit or providing an overdraft on a you on a UPI. As far as mpci is concerned, they have been pushing it hard with with regulators, or regulatory sticking it time, but you know, many things they yield from time to time, so so it's only a moment of time that will happen. But by the time you know, what do you what is already happening is that based on the UPI based transactions, and all the companies like your tap has started providing a credit. So you so you do not have direct direct credit. But when a gap of a layer with with one degree of a difference, you have a credit made available in the ecosystem, so so not that badly placed at the moment. But yeah, up no credit is the ultimate thing that you want to see.

Krishna Jonnakadla  1:08:10

And I think coupled with that, I think a couple of things need to happen, in my opinion, improving cost of capital. Because we have a we have a very ironic situation, because we have a country of close to 1.4 billion people. Despite jam, which is jantan Aadhaar and UPI the jam Trinity or whatever, whatever that is called the India stack, which ended up in hundreds of millions of accounts getting opened. If we have monetary policy that is so obsessed about inflation all the time, it effectively means that the plumbing of the financial ecosystem is only targeted at a few outlets only because when whenever there is pumping of money, if there is inflation, that essentially means that the money is not spread as wide. So that's that's one because I've seen that my uncle has has been running an NB FC for 30 plus years. Even today, if a business 25 years ago, their cost of capital in a tier two town was 30% per year. And even today, if it's almost 30% year per year, notwithstanding all the optimization that's happened across the world. Imagine if his cost of effort if the cost of capital of an msme is 30%. He literally has no money either for lifestyle, or even for innovation. Which is why you have so much copycat innovation that happens on all fronts, right? somewhere. This whole notion of improving the plumbing on the policy level how To change so that when you unleash a trillion dollars, you are not always obsessing that you know what I am going to see double digit inflation. And therefore, as soon as double digit inflation happens, the government will actually be voted out. That's that's essentially what keeps happening, that cycle keeps repeating all over. Right, no matter what the government does, some inflationary angle comes in, which is why central bankers are so obsessed about keeping a sub 5% inflation, right single mandate, single mandate, and that is virtually eaten in it's it's become a sort of viral disease, at least in the financial ecosystem. Because that cost adds up. Because msme msmes provide 95% of all services and products in the country. That means if their cost of capital is 30%, that means everybody else is inheriting that cost of capital somewhere. Right? So hopefully, you know, something will happen. happen there. So now, what is your perspective in five years? Where will we see load that

Satyam Kumar  1:11:15

so long that is on its path to, you know, to an IPO because as an organization, we feel that that brings in the whole sanctity, anger, the board, anger, everything to the floor, and that market in India is fairly robust has it has a good amount of traction, both from the retail as well as the institutional investor ecosystems, and also that solves a lot of challenges for drug organizations. So yeah, the path to IPO is what Gods Of course, it got delayed in last two years. But typically, we have seen an IPO in our segment happening at the 10 times of the current levels, so about typically about 4000 crores, and for books, that is a good book to go for an IPO, that is where most of the lending institutions held IPOs, other than one small finance bank, which was at a higher level. But marginally higher level, so it's a good place to go to showcase what you have built. So that's, that's an important milestone that we are looking forward to. So so you know, two and a half years is typically what it takes to move 10x at the end of a base in a continuous organization. And that's the path where we have been building it.

Krishna Jonnakadla  1:12:39

Interesting, and how have the last five years enough? Aside from all the macro events, which are occurring with a large, lot more frequency now? Perhaps it's because the world is so connected? That's one of the reasons what are the surprises that you have seen in the last five years?

Satyam Kumar  1:13:03

Yeah, so organization wise, you know, being here, both at the cusp of making a credit, acquiring a customer so so you know, being a close your eye in track, or I interact a place where both hands shaping up the institution philosophy. At the same time, I'm also learning from the market from the customer, okay, which doesn't happen and when I'm sitting in a traditional world, where the feedback comes, comes in a free database, so, you hear the feedback comes direct, right. So, so, our own we have been going through our own cycle of unlearning and learning practices. So, the way consumer behavior has been changing and the way we need to respond is far different today than we set out in the beginning. So, we set out in a beginning assuming that hey, this is how the customer behaves, because this is how we have done the loan, this is how we have seen people consuming using the money in Excel and then you realize that a whole new generation is coming. So just to give you an example now, now the people who are about a decade younger than us, okay, their money doesn't sit in their bank account right. So, their money sits in a five places somewhere it will sit in a wallet somewhere it will sit on a card somewhere it will sit on a to bank account, and many times it also sit with a friend so like if they go to a restaurant right. So one person will make a payment and everyone else will KTM him Okay. Now, how do you imagine that it is his expense or it is it is a collective expense okay. And what how do you expense it out in your cash flows understanding or how how do you take the income which is coming from like, which is the credit which is coming from from other friends as a shared sharing of the bill. So, these are the things which was like, Come pretty different way of looking at, in a traditional institution always say that, hey, there's like a random incidence there will not make a policy for a year here you you are constantly re engaging with with the ecosystem and improvising on the policy. So, you know, this, this is completely different world, which which we would have imagined. And you know, we always say that the management is away from the ground and all and here I can, I can see it happening that even though we say that we will be at the startup guys, okay, that means we are building for the consumer. And at the same time, at the assumption level, we are so much away, okay. And whenever you create an assumption, your credit product, that is always in a hindsight, right, so something has happened, you assumed when you built it, but what is happening in future is always improvising or changing. It's a continuous improvisation of your policy, your user experience is very different than building for 10 years. So here, you don't build for 10 year you don't build for things for five years, you build for a product, you build product, which is which is relevant today could be relevant for another couple of quarters. And then you start thinking that how are you going to reengage with our keep your, your, your customers engaged? With you? It's It's, it's, it's a pretty different ground to update. So you know, you have a couple of variables, which is, which is the guiding factor that a how you want to run our mansion in terms of operating environment or credit risk or the business risk? But beyond that guiding principle, everything is moving?

Krishna Jonnakadla  1:16:41

Do you read in general business books, that kind of stuff?

Satyam Kumar  1:16:47

Yeah, earlier, I used to less, less business books, but lots of mythologies and all that we read, because lots of stuff I personally feel is more like a repeat many things has happened. It's like really fate and also so so so that, that gives a very good understanding of a current context, which is how its analyzed in, in, in retrospect, but some business book also but not not so much of a business book, it's it's still more around your stuffs like yoga sisters and guitars and all which which gives, which gives clarity, even contextual clarity also, on how to deal how to how to deal with a situation or how to how to approach a decision.

Krishna Jonnakadla  1:17:34

What's the most insightful book you've read of late? Recently,

Satyam Kumar  1:17:40

your gosh, it was like a life changing book for me about one and a half years back at the beginning of a pandemic, which should be just expanded, even the middle class mindset. So like, as I said, that I have been evolving with the time I've been more of a, you know, society guy, and the more of someone who has been shaped by the society, but your sister just expanded the thinking that hey, I mean, it's what you manifest is what you are out to do. So you know, so that was a great revelation, which revelation which happened for me.

Krishna Jonnakadla  1:18:16

Pretty interesting. You know, the funny thing is, there are a couple of there's a author called Lynne McTaggart, and if you if, if you've heard the name, she has authored a couple of books one is called the intention experiment. And the other one is called the field. And field, the field essentially, the essence of what you just described is that life is a self fulfilling prophecy. And that's the essence and in that, in these two books, there are it is one thing because because in the Indian spiritual realm, there there has always been a concept called the Darshan, which is, the there is that other person who has seen that ultimate reality, and therefore, they're expounding on that reality and most of these books related to yoga Gita are books by those people that have seen that reality. What Lynne McTaggart books do is give you a lot more than a lot more from your own world, our own world our own reality experiments that were done to show that this is exactly how light behaves. So for example, at the atomic level or subatomic level, the funny thing is a proton and a neutron. They're not static. When you observe them, they actually move. So that so the funny thing is the then you are thinking is Is it the observer? Or is it the observed? So it's a it's an interesting, when you rise above the atomic levels, there is a lot more fascinating stories. So if I had to encapsulate all of that into one sentence, its life is a self fulfilling prophecy. Interesting. You should mention that. So, Satya, this has been an amazing conversation. And I know that his tiny bits that you spoke about the evolution of FinTech, we've always, we are always used to talking about blue oceans and white spaces, but finding niche white spaces and capitalizing on them is also a nuance. And if you look back at many products, perhaps that's what they in effect actually did. Many of them did not create vast new spaces all together, perhaps they found a new way to that particular aspect itself was a white space. So you brought that to light and it was good to have you. We know that whenever you scale your next week, Maharaja subscale will come back and speak to you and talk about how the paradigm method paradigm has changed and how you change the paradigm. Any closing comments, comments before we sign off?

Satyam Kumar  1:21:21

Thank you very much Krishna. It hasn't been either interaction interacting with you and talking to the audience. Here it is absolute fun. Not much to elaborate further.

Krishna Jonnakadla  1:21:33 Thank you, sir. Tim, we wish you the very best. Thank you very much. Thank you for listening. If you enjoyed listening to the show, and want to help support our show, please leave us a review by visiting our website Maharaja subscale.com forward slash reviews. It helps other people like you discover the show. like totally appreciate your support. If you're a founder or an entrepreneur, or anyone interested in or working with startups, this show is where you see discussions in depth about founder stories, their playbooks and learn more about growth strategies. Visit our website for regular updates, or wherever you get your podcasts and discover more awesome episodes. I'll see you on the next episode. Click on the bell icon and hit subscribe to get the latest episodes