Paisabazaar.com aims to roll out innovative products under its long-term growth strategy. With the Step-Up Credit Credit Card, it aims to make credit more accessible especially among the underserved segments by helping consumers with damaged credit or no credit history to build their credit score, thus strengthening the lending ecosystem in the long term.
It is a secured card provided against a fixed deposit (with SBM Bank of India). With an end-to-end digital process, it is instantly issued and activated.
Neeraj Sinha, Head, Retail & Consumer Banking, SBM Bank India, said, “At SBM Bank India, we believe smart banking – being a combination of technology and banking as a service, solves problems and empowers people. In India, the penetration of credit cards is low owing to a lack of credit history and high delinquencies. We partnered with Paisabazaar to design a product that solved both these challenges – backed by a fixed deposit, it not only protects the quality of the assets but also helps build the credit score. We conducted a pilot program which witnessed great results and today we are launching the card for everyone.”
Naveen Kukreja, CEO & Co-founder, Paisabazaar.com, said, “For India’s lending industry, the big challenge remains market under-penetration. Even today, credit is restricted to only select consumer segments. At Paisabazaar, we are uniquely placed to expand the reach of formal credit, together with our partners.”
India’s household debt to GDP ratio remains considerably lower than that of the developed market like the US and the UK. This reflects the low penetration of formal credit in the country. Formal credit remains restricted to select consumer segments. Salaried Sub-Prime, New to credit, and SMEs have limited access to formal credit than the Salaried-Prime segment which benefits from large Banks and NBFCs.