Money Club Technologies Pvt Ltd

Date: 30 Dec, 2021

Money Club is an innovative peer-to-peer lending and borrowing fintech platform that caters to the need of emergency funds during contingencies for low-income populations. It differs from other lending platforms in terms of its gamification, higher frequency of pooling, micro-pooling, and easy on-boarding through its mobile experience. Additionally, the company relies on its risk underwriting algorithms to prevent subscribers’ defaults.

 About the company:
 The Company was started by Manuraj Jain and Surajit Ray. Manuraj comes from a consulting background having been part of Intellecap, a management consulting firm, where he led technology management initiatives to increase the access to financial services in rural areas. On the other hand, Surajit has close to 2 decades of experience in solution architecture, predictive data analytics and cloud deployment. The platform has acquired over 200,000 users and has grown 500% in the last 12 months. The users have pooled around INR 40 crores by forming 17,000 money clubs on the platform till date. It has a team of 25 people.

How it works:

• The User first downloads the app available on Google Play Store.
• User fills in the requisite information and then receives a call from Money Club within 24 hours.
• When the user first joins, he is placed in the Pilot zone.
• In every round one member can pick the pooled amount by bidding highest interest than other members and depending on the number of members in the club equivalent rounds will be held.
• The user upgrades to larger clubs depending on the frequency and behavioural aspects of his transacting history.

Industry Landscape:

• Lending is one of the oldest and most prevalent forms of community-based finance in India. They offer both saving and borrowing mechanisms to individuals who are excluded from India’s formal financial system.
• Lending platforms typically pool funds from a group of participants, who may also borrow from the same pool based on predefined rules and timelines. Unlike collective investment schemes where capital is invested in external assets the pooled funds here are used solely to provide lump-sum or credit access to participating members.
• The unorganized lending market is estimated to be 3–4x larger than the organized segment, which is currently valued at approximately INR 60,000 crores. The market has grown at a rate of 10–15% over the past few years and is expected to continue witnessing strong growth going forward.

Rationale for investment:

• Experienced founding team — Manuraj comes with a strong consulting background wherein he has led technology management initiatives to increase the access of financial services in the rural areas. On the other hand, Surajit has close to 2 decades of experience in solution architecture, predictive data analytics and cloud deployment.
• Market opportunity — This is a highly unorganized market which is ripe for technological disruption. Money Club assumes the role of the foreman in traditional chit funds, by using technology and making its services more transparent and reliable compared to traditional chit companies.

Conclusion:
 By offering an online lending experience, Money Club helps all those who need financial assistance and encourages a saving culture by eliminating some of the key risks associated with traditional lending funds. By leveraging technology and leading disruption in the sector, Money Club stands out as a strong market leader. By taking advantage of this distinct approach, the Company intends to expand quickly.

The above report has been prepared by Rockstud Capital LLP (“Investment Manager”) for informational purposes only and is subject to change without notice. The delivery of the report does not imply that the information contained herein is correct as of any time subsequent to the date specified in the contents of the Information. The financials in the above report are intentionally not mentioned due to confidentiality reasons.

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