RevFin to disrupt commercial EV lending

Extending loans to three-wheelers, sees scope to make inroads into two-wheeler segment

Hyderabad: India is aiming for mobility that is going to be electric. While governments are pushing for electric vehicle (EV) adoption, e-commerce and logistics companies are increasingly looking at adding EVs to their fleet. However, a major challenge remains to be the lack of EV financing avenues in the commercial category. In order to stimulate the country’s shift to electric mobility, RevFin is addressing this problem.

Sameer Aggarwal, founder and CEO, RevFin, told Telangana Today, “The EV segment, though currently small, has a lot of potential to rapidly grow in India. We also realise there is a credit gap in the EV space. Electric three-wheelers, which are used commercially do generate revenues (and since the loan is for a productive purpose), the repayment becomes easier. We plan to strengthen our ties with banks and NBFCs in the future.”

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He added, “EV adoption is not only happening in big cities, but also in tier-3 and tier-4 towns. In large cities, there is migrant risk, but in small towns, those who take loans are primarily residents. So, there is less risk of bad loans. There are two million three-wheeler EVs in India. They cost Rs 1,30,000-Rs 1,40,000 per unit, which makes them affordable. Two-wheelers are gradually picking up to replace fuel vehicles. Commercial two-wheelers used for delivery services and last mile connectivity are going to drive the EV adoption. Intra-city consumption will prove to be a large market.”

The company focused on psychometrics, biometrics, and gamification when it developed its platform to address bad loans. This has helped in underwriting. It took about six months to create its platform before it launched it in October 2018. “We have so far issued 1,500 loans for commercial three-wheelers. In the next three years, we plan to give loans for 3,00,000 EVs and raise Rs 1,000 crore through a mix of equity and debt. We are talking to OEMs and online aggregators for commercial two-wheelers and plan to introduce it soon,” he informed.

The environmental aspect is making large corporates to adopt EVs as they see it as a means for carbon neutrality and sustainability. This will also give volumes in the coming years.

In the last 6-8 months, RevFin is closely working with e-commerce companies in their fleet expansion. The company also works with OEMs for due diligence. “We have embedded refurbishment aspects in the agreement with OEMs so that we can refinance the vehicle, so that the entire ecosystem is created for the secondary market. We have also ensured that the EMIs are as low as Rs 6,000-Rs 6,500 while the loan structure is fixed while financing EVs, which is seen as the best benchmark EMI for customers. We have integrated the insurance for the person and the vehicle. Claim processing for drivers is being worked out currently. We are building ecosystem partnerships with all the stakeholders- EOMs, dealers, delivery firms, insurance companies, drivers, battery charging companies,” he added.

The company, which has raised $3 million so far, is talking to a few OEMs in Hyderabad and hopes to enter into this market in a couple of months. There is a possibility to be at least in three southern States by the end of 2021, Aggarwal said.

RevFin is also planning to add more internet of things applications to help improve driver productivity, voice-based solutions in vernacular language, and convert the platform into multi-channel interaction, he informed.

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