Should fintech firms lend to customers with low credit score?
Fintech companies and a few other lenders see this segment as an untapped market opportunity
It is unhealthy for the fintech if they don’t analyse and have segment-wise interest rates
Most banks do not lend to customers with a credit score below 750, which is considered poor. Such customers make for about one-third of the personal loan segment, according to a recent Bloomberg Quint report. Fintech companies are hoping to cater to such customers by filling the gap. Besides, millennials with low credit scores are turning to fintechs for loans, say experts. A recent report from CASEe, a fintech firm, said 64% of its demand for loans in 2018 came from the 21-30 years age-group. Disha Sanghvi asks four experts whether it is healthy for fintech companies to lend to such consumers?