of companies like EarlySalary, PayMeIndia
among others offer instant loans to
professionals for a short duration that helps
people tide over the immediate cash crunch.
Mahesh Shukla, co-founder and CEO of
PayMeIndia, a fintech company, says that in the
scenarios where salaries are delayed or people
have run out of money, a salary advance comes
in handy.
Fintech companies are also seeing an
opportunity because banks don’t cater to this
need. A salary advance loan is a quick solution
to help avoid the embarrassment of asking
someone for money. It’s a new and hassle-free
way to get your salary just when you need it,
that too within minutes. “Banks would require
you to have a strong CIBIL score to be able to
borrow. Moreover, banks will provide you with
personal loan schemes for around `3 lakh for
a time period of 36 months rather than short-
term loans like `20,000 for 10 days till the
next salary day,” says Akshay Mehrotra, co-
founder and CEO, EarlySalary.com, a fintech
company, which focuses on providing salary
advance options.
What also makes this a strong business
proposition is that employers are tying up with
Fintech companies to offer salary advance
options to their employees; an association that
benefits all parties. Mehrotra claims to have
associated with 150 companies for providing
salary advance, “We have tie-ups with various
companies including large IT companies like
KPIT, and e-commerce companies like Flipkart
to offer instant loans to employees. One of the
most interesting tie-up includes the one with
Enrich Salon as the hair stylists were never
able to borrow with such ease from a regular
financial institution.”
If a company is associated with EarlySalary,
the eligibility criterion is relaxed; there is no
restriction for minimum salary of `20,000 per
month or minimum three month’s salary credit.
Employees of these companies get an edge over
others as they can borrow large amount and
pay-back in EMIs for specific problems like
house deposits, medical emergencies, school
fees payment, etc, along with reduced interest
rates. One also gets options for interest free
online shopping on EMIs. Employers on the
other hand benefit by not having to worry
about setting an internal process that extends
salary advances around the clock. These
fintech companies also free the employer from
liability in case of non–payment. Elaborating
on the merits of these tie-ups Shukla says:
Photo: Soumik kar
www.outlookmoney.com December 2017 Outlook Money
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