Taking to LinkedIn, OkCredit cofounder Harsh Pokharna said given the changes in regulations around P2P lending by the Reserve Bank of India last year, the startup decided to close the platform.
The OkNivesh platform enabled small businesses using the OkCredit application to invest in short-term investment programmes with an instant withdrawal facility. The invested amount would be extended as credit to borrowers through a P2P platform.
Pokharna said given the RBI has stopped instant withdrawals, and platforms are pushing for longer tenure loans, the offering is no longer suitable for his user base. He added that OkNivesh got a favourable customer response with 14,000 users investing Rs 30 crore through the platform in the past one year.
The development comes at a time when several partnerships built between fintech applications and P2P lending platforms have attracted regulatory scrutiny for breaking RBI’s P2P lending rules. BharatPe shut down its P2P lending product last year after regulatory scrutiny while Cred slowed down operations at Mint, its P2P lending product.
On the way forward, OkCredit will focus on its traditional credit product OkLoan where it partners with non-banking finance companies and banks to extend credit to business owners.
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Pokharna said OkLoan has issued 65,000 loans disbursing Rs 400 crore and has a total non-performing asset base of 2.5%. Founded in 2017, OkCredit raised around $85 million in equity funding since inception. In 2019, the company raised $67 million from Tiger Global and Lightspeed India.
OkCredit closed FY24 with an operational revenue of Rs 14.3 crore and a net loss of Rs 35 crore.
