EXCLUSIVE – Online payment service provider PayU is expanding its partnership with digital lender Kreditech by launching a cardless EMIs (equated monthly installments) service for consumers to finance the online purchases in India, a crucial market for both parties.

That service is being called PayU Monedo, and as of today is available in beta phase.

India is a key market for PayU and Kreditech, both of whom focus on underbanked populations in emerging markets. India is particularly interesting because the country, with its 2 billion-plus population, has leapfrogged from desktop computers directly to the mobile ecosystem when it comes to payments and banking.

Even the Indian government has been incentivizing the country to move in a cashless direction. And thanks to the national identity scheme known as Aadhaar, it has the world’s largest central biometrics database, which is only catalyzing this mobile adaption. In fact, Amitabh Kant, the head of a government-run policy institute, predicts biometrics is likely to replace cards by as much as 85% by 2020. Read more about Indian consumers and biometrics here.

The one area that is still relatively nascent in the country is digital lending. That’s the gap that PayU Monedo is hoping to fill, at least on the consumer online point-of-sales side.

In a statement emailed to Bank Innovation, Shailaz Nag, MD & Co-founder, PayU India, said:

PayU’s goal is to offer more shopping opportunities to those who, for various reasons have no access to credit. We help online shoppers to buy the latest mobile phones, laptops, consumer durables & much more on easy EMI without a credit card. PayU Monedo is easy to use, quick and offers flexibility. We are already talking to merchants in the e-commerce, travel and other online sectors and are looking forward to providing this innovative technology as an alternative payment method in the checkout process.

For PayU and Kreditech, PayU Monedo is an expansion of their strategic partnership formed back in May 2017, after PayU invested €110 million investment in Kreditech.

PayU Monedo applies Kreditech’s machine learning-based real time underwriting capabilities through its lending-as-a service platform Monedo to PayU’s 300,000+ merchant distribution network forming an integration that lets users receive credit in less than two minutes for their online purchases. The maximum loan amount for PayU Monedo is $2,000 (about 13,000 Rupees).