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Indeed it’s a good idea and works too in real world. Understand this, majority of your potential clientele lives in rural India. There are individuals who lend money (for reference, sahukaars) to the people. They often take up jewellery, property papers, even property for the tenure. Sometimes there’s no collateral but the way they recollect the payments can be horrible. You have to consider all other scenarios other than these individuals models which are in place right now to understand the pain point of the targeted users and come up with the plan to resolve this without any conflicts or minimise it.

I see immense potential in this idea. The gig economy, for instance, has a lot of underserved workers who could benefit from such a platform.

Just a caution: many underserved borrowers are already skeptical of financial institutions. Gaining their trust will require more than just low-interest rates. Education and community outreach might be necessary to ensure they understand and feel comfortable using your platform.

While the idea sounds noble, be prepared for high default rates initially. Building trust and ensuring repayment will be challenging. Also, you might face resistance from traditional financial institutions. They might not be too happy about this disruption. What’s your strategy to overcome these potential obstacles?

Personalizing pathways to improve creditworthiness can make a significant difference. However, the main challenge would be assessing and managing the risk of lending to individuals with poor or no credit history. Any thoughts on how you’d mitigate this risk?