When you generally apply for personal loan (unsecured loan) from a top notch bank or any NBFC like Bajaj Finserv, they look into your credit score, bank account statement & IT returns. This is normal procedure to be followed by lenders and has been like this for decades.

But a new way of assessing your creditworthiness has been introduced by Pune based digital lending startup, “LoanTap”. This firm is giving people loans based on their activities on social media sites like Facebook, Instagram, Twitter, among others.

LoanTap has developed an algorithm to assemble personal, professional and financial details of the borrowers via their digital footprint. Personal details like your social media friend list, lifestyle details, and longevity of accounts, among others are taken into account while assessing the borrower’s credit worthiness.

The company was started by ex-banker Satyam Kumar and former tech-professional Vikas in May 2016.  They recently raised US $ 8 million funds in their fifth round of funding.

The concept is not new globally as more and more lenders are mining Facebook, Instagram, LinkedIn and other social media data to determine creditworthiness of their borrowers. There are reports that several banks and financial institution are looking at broader way of assessing the credit risk of borrowers. Besides quantitative aspect from IT Returns and Bank Statements, data mining of social websites adds to qualitative aspect in financial investigation. As the trends are evolving,  in near future we may witness a phenomenon where access to credit will also be dependent on our digital footprint and not just our bank account history, credit score and Form 16.


By Abhay Gupta

With background in e-commerce and IT, Abhay manages operations and backend processes at SAKSHAM Wealth. He is a data cruncher and his expertise with MS Excel helps the team in research.

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