Putting AI in finance since 2014

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India has millions of small and micro enterprises without access to the financial system. Gurgaon-based Aye Finance aims to help these companies unlock huge business opportunities while creating transformative social impact.

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Founded in 2014 by SAnjay sharma, Aye Finance strives to transform microenterprise finance in India through innovations that enable efficient credit underwriting while closely monitoring asset quality. The startup is leveraging the most relevant technology to facilitate better financial inclusion and serve microenterprises across the country in a holistic manner.

“By providing affordable inclusive finance to this ‘missing link’, we have propelled the economic transformation of over 2.6 lakhs of microenterprises using world-class automation and data science to solve this problem. problem that was considered intractable, ”Sharma shared in an interaction with Analytics India Magazine.

Aye uses artificial intelligence to drive non-linear growth, improve efficiency and profitability through digitization, and integrate cutting-edge data-driven business intelligence into all key business processes.

“We have developed and deployed advanced AI / ML solutions in most of our critical business processes within a short period of time. Some of our models for predicting critical customer behavior at a very granular level are unique and have not even been considered by other market players to our knowledge, ”said Sharma.

The trip

“Contributing to underprivileged society has been my goal since I started working 35 years ago,” Sharma said. To do this, he left a lucrative job at a large housing finance company in the United Arab Emirates and returned to India.

It was a time when MFI companies were struggling with the consequences of the microfinance crisis in Andhra. Sharma researched the market and seized the opportunity to create a new age finance company focused entirely on lending working capital to microenterprises.

At the time, this sector faced a credit deficit of INR 16 trillion. The resilience of the industry, despite the funding challenges, has led it to consider a solution to address the sector’s credit challenges, including thin files and lack of credit history.

He explored the possibility of using a cluster-based underwriting methodology for the credit assessment of these local businesses based on field notes collected during meetings with over 300 micro-businesses in five cities and six clusters. manufacturing industry. Building on this opportunity, Aye granted her first loan to a micro-entrepreneur in the Delhi Ladies’ Shoe Manufacturing Cluster in March 2014.

Since then, the company has expanded its presence to 210 branches across India and has granted more than 260,000 business loans to Indian microenterprises.

Technology stack

The company makes extensive use of exploratory and prescriptive analyzes on the client base. Aye uses bespoke AI / ML models to predict credit risk and the conversion propensity of potential customers to offer loans.

“For Aye, the term cloud came up quite early in 2015 when we hosted our frontline business application on AWS. The whole onboarding experience was great and we were impressed with the ease of scalability, ”he said.

Now, cloud computing is widely used to manage cloud resources and costs. “The auto-scaling and load balancing feature helps us maintain smooth use between applications. With features like the serverless architecture, Kubernetes and Lambda that the cloud offers, it is quite easy to manage frontend, backend and middleware applications, ”he added.

Aye’s data science and AI stack consists of a complete data lake and an AI / ML model development platform built primarily on Python. The data lake accommodates all types of structured and unstructured data, and the modeling platform communicates with the data lake for all data needs.

“We use containerization and APIs to serve these models to other business software applications used in the organization,” he said.

Sharma said they use various custom-designed AI and ML models for their products and processes to predict all events of interest throughout the customer lifecycle. The practice has improved customer acquisition, collection, personalization of upselling offers, etc.

“Several projects involving computer vision and speech recognition are underway to significantly expand our AI portfolio. These will further strengthen all of our key business processes such as underwriting, client management and collections and give us a significant competitive advantage, ”he added.

Growth story

Aye has held a leading position in lending to the underserved microentrepreneur sector over a short period of time. “Our innovative solution leverages industry cluster data and uses process automation to bring unexpected savings to our business,” said Sharma.

Since its inception in 2014, Aye has grown from a single city to more than 210 cities in 18 Indian states and has served more than 2,600,000 local businesses, paying out over INR 3,800 crore.

“Our revenues have grown at an equally rapid scale. Compared to fiscal year 2018-19, our turnover for the last fiscal year doubled to INR 410 crores ”, he added.


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