Paytm building tech to check ‘credibility score’ of borrower

Paytm has set it’s sights on evolving a mechanism to determine the “credibility score” of a person seeking loan from a bank.

The company’s team in Toronto is actively working on a reliable system that can be relied upon by banks to ascertain the credibility of a loan-seeker.

Paytm CEO Harinder Takhar said the mechanism would go a long way in aiding banks to determine whether it would be safe to grant a loan to an individual.

“The credibility of an individual can be ascertained from the nature of his digital transactions, which tell you a lot about his behaviour,” Takhar told ET. “If a reliable system is evolved, which can predict with sufficient accuracy about the capacity and willingness of an individual to return his/her loan, it would tremendously help the lender.”

Paytm’s Toronto office, which houses nearly 100 employees from diverse backgrounds, is working on an algorithm to present a solution. With the number of non-performing assets on the upswing and defaulters escaping clutches of law after duping banks of crores of rupees, banks have become wary of offering loans.

Takhar said “access to capital” is pivotal to growth. He underlined the need of capital for a small-level entrepreneur who aspires to grow his business but is unable to do so on account of non-release of loans by banks. The mechanism will be a boon for both customers and banks, Takhar indicated.

He said the Toronto office houses the “fraud prevention” team of Paytm. The team of nearly 10 data-crunching experts keep a close eye on the digital purchases being made through Paytm. Any suspicious activity by a client is immediately red-flagged to the team in India.

With plans to make it big in Canada, Paytm is also eyeing to capitalise on the lack of Canadian customers indulging in making digital payments. As per available information, nearly 30% of Canadian customers do not make digital payments.

The reporter is in Canada at the invitation of the Canadian High Commission

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