Digital credit as an employee benefit


Seeking a formal bank loan in India has been tedious and it always means large sums of money. For smaller needs, people simply borrow from friends, relatives and often employers too. This introduces risk for the lender, and can cause loss of dignity or respect for the borrower. Employee needs can arise at any time, and for various reasons. From an employer’s point of view, handling such lending transactions on a frequent basis can become a hassle.

Offering respite, NIRA, a new-age digital credit provider, partners with employers to offer credit to their employees as their needs arise. Even in cases where employers partner with banks, the banks have very restrictive lending criteria and the minimum loan size is usually Rs. 1 lakh. Hence, employees on more modest incomes mostly go unserved.

Rohit Sen, CEO and cofounder of NIRA, had spent 12 years in finance as a trader in London before embarking on his entrepreneurial journey in India. During that time, while visiting his family here, he noticed a difference each year in the availability of goods and services, as well as their accessibility. He was excited about the rapid social and economic changes in India and with that, he identified a need for more financial inclusivity at the urban level. This, and a need for risk and adventure brought him back to the country of his roots with a purpose — with an aim to create something bigger. Thus was born NIRA, the simple, effective solution for small, digital credit.

Before Sen conceived NIRA, he shares that some basic market research on the availability of credit in India revealed that only a small proportion of people can get a loan from banks. Also, there were only a handful of startups looking to address the issue for everyone else. NIRA is the result of the realisation that the financial system wasn’t offering small-sized loans, which is what most Indians seeking finance need.

Besides the strong need, the market is now ready for digital credit. People are now used to trying out new products on apps, are familiar with the concept of EMI, and when offered a process that’s much more convenient than a bank, they are happy to embrace it. But what has it got to do with an organisation?

Well, that’s another big question that NIRA answers through its cost-free, risk-free, ‘credit as a benefit’ solution. Yet, when asked about overall awareness around the benefits of digital credit, Sen opines, “I think individual awareness, while low, is increasing quickly since there are more players in this space. Corporate awareness is still pretty minimal; until the concept is presented to them, it’s not something that naturally occurs on their radar.”

But once informed and explained about it, the corporates seem to find it valuable to have an alternate and accessible source of funding for their people. “We’ve seen an excellent response once we speak to HR about our product,” says Sen. He also shares that nearly all employers that they’ve spoken to, immediately recognised the problem of employees seeking a loan from the company, whenever they have expenses which they can’t meet ordinarily.

Some of the most common reasons for people seeking small loans include medical issues of a family member, weddings, school fees and other expected household-related costs. This becomes a real resource drain for the employer, especially during times when employees seek help. It not only consumes HR bandwidth but also creates a financial burden for the company. Taking this hassle off the employers’ plate, NIRA replaces the present ad hoc arrangement between employees and their employer, with a systemised process which completely takes care of employees’ requirements of small credits, and all for free!

It’s better for the employees too since they get their credit faster, and there’s no need for an uncomfortable conversation with the manager. As another added perk, employees of NIRA’s partner companies benefit from a better interest rate than borrowers who approach NIRA directly via their website or app.

The journey from taking the leap of moving to India, leaving behind a lucrative career in finance in London, to developing a fintech solution that gives people the freedom and flexibility along with easy access to small loans, has been exciting so far. As Sen says, “For the first time in my career, I’m not feeling the Monday morning blues!”

He strongly believes that one should have a purpose behind what one does. Therefore, he himself strives to run NIRA with a strong purpose and emphasises the same. He says, “If we are just building a product, it’s easy to lose faith when the going gets tough. When you are here to solve a problem, that gives you something to think about and work on every single day.”

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