Here's why Edwin's projections are achievable:
Let's look at the two sides of the new business -
The personal loan side & the MSME side
The personal side : He states in the PR that these loans will be $200-$300, and last around 30-90 days. With an agency fee of 8%-10%. He thinks they can do 25,000 of these a month. So let's take the low side $200 x 8% = $16 agency fee per loan. 25,000 x $16 = $400,000 a month.
Now the thing I don't understand is he never mentions daily interest on these loans. Other competitors are charging daily interest from 0.2%-0.8%. Then most charge the admin fee of 1%-2% on the loan value. Maybe he's rolling it all into the 8%-10% figure.
The MSME side : He states these loans will be from $1000-$5000 and last from 30-90 days. Same agency fee. He projects 5000 of these a month. Low end $1000 x 8% = $80 per loan agency fee. 5000 loans x $80 = $400,000 per month.
Akseleran started its p2p business on 10-2-17. In the first 9 months (until 6-30-18) they did $4.6 mil in loans. These were all MSE loans. They did not start their personal loan business until January this year. 4,600,000 / 9 months = $511,000 a month in loans. At this point Akseleran had only $1.85 mil in funding from Bintraco Dharma's parent company, and some angel investors. They went after warehouses and outlets to establish a customer base. Doing mostly invoice financing.
The number of MSME's that don't have access to legitimate financing is incredible. Using the numbers given, somewhere above 47 million. Once you get the business owner on board, they tend to reuse your product. Akseleran says their repeat use is at 75%.
Even a company like Cairin that just got registered on 4-8-19 has on their website total loans disbursed $12,347,171.79 usd. With 95,508 borrower accounts. That's over $1.7 mil a month in loans.
If you've spent as much time as I have looking at all these companies, you would see what good things are coming. I can't wait to see how the app and website come out.
Best of luck KFUND. 2020 will be great.
