MoneyTap, a fintech startup, has launched India’s first app-based credit line providing services, in partnership with the RBL Bank. A credit line facility was available for only businesses until now.
This credit line will allow users to borrow up to Rs. 5 lakh, without any compound interest. Even the interests levied can be as low as 1.25% per month on the principal amount. The least amount that can be borrowed is Rs. 3,000. The amount can be repaid as EMI in two months to three years. The limit is immediately replenished after the amount is paid back.
Any salaried person can download the free Android app and in a few minutes and provide all the information that is required by banks. The app securely connects with the banking systems for instant approval and a credit limit, depending on the user’s credit history.
RBL is going to provide the funds for the credit lines and instant decision-making technology/algorithm.
As per RBI guidelines, even if the transactions are initiated on the MoneyTap app, all financial transactions will be done using the bank APIs.
In an age where the country is filled with an urban poor population, such a novel idea is a blessing. With the youth-obsessed with independence, new jobs, start-ups, this easily available short-term funding can prove to be a lifestyle changer.
It is available for users in Delhi-NCR, Mumbai, Bangalore, Hyderabad, and Chennai. The RBL MoneyTap card will be just as good as any other Mastercard for shopping and other purposes. The only cost here is that all qualified users will have to pay a one-time set-up fee of INR 499 plus tax after the KYC process is over. This minimal cost seems like too little for the amount of potential this concept has.