The platform handles both the lending process for borrowers and lenders.
Introducing a new model to an industry that is traditionally very conservative was the biggest challenge that consumer-centric lending platform Lendela had to face when the company started in 2018.
“This required some education to quell the scepticism from both banks and lenders in the beginning,” Lendela founder and CEO Nima Karimi said in an interview with Singapore Business Review.
According to Karimi, there is a lack of transparency and simplicity in personal finance in general, and lending in particular. Application processes are extremely tedious and time consuming, with borrowers having to apply multiple times to get multiple offers and still end up without a loan.
Lendela is about empowering borrowers by simplifying the application process, providing transparency and improving the user experience.
“From the lender’s perspective, customer acquisition is both highly competitive and expensive, resulting in lenders spending a lot of money on marketing whilst at the same time having to reject a significant share of the customers acquired. Lendela serves as a risk-free customer acquisition channel for our partnering lenders,” Karimi said.
The platform serves as a matchmaker of sorts. It connects with multitude of partner lenders and gives borrowers access to the best rates in the market. Borrowers only need to fill out an online application and then they can already compare a range of personalised offers to find the loan that is best for them.
“Our profit is commission-based. Once an applicant accepts an offer, we get paid a fee from the chosen lender upon disbursal,” Karimi explained.
Lendela is fully integrated with its partner lenders, avoiding the nuisance of having to visit multiple sites to apply for a loan and only to receive multiple offers based on their situation. In this way, the platform remains to be a customer-centric interface.
Right now, Lendela has a combined funding of $5.29m (US$4m) after its last pre-series A funding round led by Promise Future International and 2be.lu Investments.
Karimi said Lendela is banking on the simplicity of its model and the fact that it facilitates the lending process for both borrowers and lenders to attract more investors.
“We are a lean but highly experienced team, with an extensive background in building this type of business and developing the same type of service in multiple markets prior to entering Southeast Asia. At the end of the day, it will come down to showing continuous growth and improving on our key metrics,” he added.
In the next five years, Lendela plans to be the market leader in loan comparisons within Asia Pacific, with a greater aim of increasing transparency and offering greater financial inclusion for the masses.
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