$87 Billion Indian Conglomerate


India’s finance industry is currently under a fintech revolution. Big platforms companies like Alibaba, Tencent and Ant Financial are all investing heavily in India and expanding into financial services, and startups like Paytm, PolicyBazaar and others are quickly gaining traction. Reliance sought to embrace the disruption and create its own platform business initiative. It already had significant advantages in key areas over fintech competitors – such as customer acquisition cost and cost of funds – but it needed a partner that could move quickly to launch a platform business before its newfound competition captured the market.

Reliance Case Study: India Fintech Landscape

The Fintech Landscape in India. Source: Applico

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Client Challenge

Reliance had successful lines of business in everything from insurance to mutual funds to lending. It touched many areas of its customers financial lives, but it needed help to identify the right platform opportunity based on its core business’s existing assets. Reliance looked to Applico to help it focus in on the right platform opportunity to capture this market. Working together collaboratively with the CEO’s of each business unit, we were able to identify the opportunity to establish a foothold in a fast-growing and underserved market segment that would give it in advantage in combating disruption from platform monopolies and startups in India.

The large platforms and fintechs in India have succeeded mostly in penetrating large urban markets. Rural communities, which make up most of India’s population, have not equally benefited from the rise of fintech. In rural markets, there is a massive credit gap for consumers and SMBs.

Lack of financial literacy and understanding of credit scores further complicates the problem of inadequate access to financial services in India. Reliance, one of India’s largest conglomerates, sought to address this problem head on by bringing fintech to rural India.

In rural India, many individual borrowers turn to local lenders in an unregulated environment for short-term capital. SMBs often seek debt financing from their own suppliers for short term working capital loans. Individual consumers and small businesses rarely approach traditional banks due to lengthy loan application processes that in the end turn away many borrowers because they lack credit histories.

But there is an opportunity to bring financial services to rural India without going through traditional banks. Smartphone use has proliferated in India. Another 300 million residents are estimated to come online in the next five years, and most of these will be in rural areas. Internet connectivity, particularly through smartphones, will bolster access to financial services because nearly all financial transactions (such as money transfers and utility payments) in India require SMS text confirmation. With permission from the user, a log of these financial texts can be used to create a financial profile and simulated credit score.

Furthermore, the Indian government’s biometric Aadhaar system has enabled easy and accurate identity verification. Currently, lending institutions are able to use Aadhaar to satisfy know-your-customers requirements.

These technological and policy developments made it possible for Reliance to shift its strategy towards providing rural loans. In terms of logistics infrastructure, Reliance was already well positioned to distribute loans. Its existing lines of business and assets gave it a footprint throughout the country. These millions of consumer touchpoints enabled the platform to more readily appraise, monitor, and collect on loans. However, Reliance’s existing lending business was primarily focused on mortgage lending, which is subsidized by the government. Reliance was ready to broaden its lending portfolio by leveraging the expertise of third-party fintech lenders and using its own infrastructure as a conduit for those services.

Applico’s Solution

After focusing in on the rural-market opportunity, Applico helped Reliance launch a lending platform that could easily connect SMB owners with fintech lenders who were already providing credit in urban India, but who currently had no easy way of serving rural customers profitably.

Applico validated a lending platform that connected merchants and SMBs with fintech lenders. It was able to use Reliance’s existing assets to help onboard customers and acquire initial financial and user data needed to inform underwriting decisions. The platform then enabled borrowers to apply for loans through its marketplace of fintech lenders. Furthermore, the platform’s loan process was paperless and application approval could be given within minutes. Reliance’s platform also facilitated the distribution of funds and collection of repayments. In addition, participating lenders could use the platform to open bank accounts or utilize collection services for nonperforming loans.


Within three months, Applico was administering loans through the new platform business based on loan application data as well as financial transactional metadata provided by a borrower’s cellphone. This data was then anonymized and scrubbed for any personally identifiable information. Then the data was reviewed by multiple fintech lenders that the Applico team had signed up to the platform. These fintech lenders were already lending to SMBs in metropolitan areas like Mumbai, but didn’t have the ability to expand into nearby rural areas. The platform helped them expand their geographic footprint and serve new types of customers.

Applico also partnered with local community services organizations to help market and spread awareness about the platform into these new markets. These organizations educated local residents on how to start and operate their own small businesses. Applico validated that these partners offered much more efficient outreach than traditional marketing channels.

Applico helped Reliance achieve what it set out to do: bring fintech lending to rural India by using Reliance’s existing infrastructure to move cash. Notably, the platform’s SMB data combined with Reliance’s infrastructure made it possible for fintech lenders to lend with confidence in new regions. The model is replicable across the nation and helps improve access to finance for millions of rural Indians.

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