Monix Co Ltd, a digital loan provider under Siam Commercial Bank (SCB), aims to grow its nanofinance lending to 5 billion baht by the end of this year.
The company also aims to keep its bad debt ratio in single digits where it currently sits through the use of artificial intelligence (AI) technology.
Monix offers nanofinance loans via a digital lending application called Finnix, which has been rebranded from the Hahi Money app.
Starting operations in May 2020, there have been more than 3.5 million downloads of its digital lending app. The company has granted more than 3 billion baht worth of loans to customers.
Monix wants to grow its loan book to 5 billion baht by the end of this year, said chief operating officer Thiranun Arunwattanakul.
As the company focuses on lower-income customers whose monthly income is in the range of 7,000-12,000 baht, covering both salaried employees and self-employed clients, digital technology such as AI and machine learning are the key to analysing customers' credit risk, she said.
By using alternative data based on mobile usage, Monix opens up borrowing to clients who have no banking history. Applicants need to use SCB's mobile banking app SCB Easy and allow Monix to connect customers' data with the app.
The company also requires a copy of the borrower's ID card on the digital loan application.
Ms Thiranun said customers can select options on monthly debt instalments, minimum repayments per month and payment channels.
"In addition to giving lower-income earners better access to financial resources, Monix aims to help loan shark borrowers enter into the financial system using fair pricing," she said. The company charges a 33% annual interest rate for its Finnix digital loan, meeting central bank regulations.
Under a nanofinance licence, the minimum and maximum credit lines via the Finnix app are 2,000 baht and 100,000 baht, respectively, while the average credit line for existing customers is 15,000 baht each. The loan approval rate is 25% of total applicants.
"After the third wave of the pandemic, some customers still face hardship and chose to pay only interest. However, the company expects to control non-performing loans in the single digits this year," Ms Thiranun said.
With AI technology, Finnix can adjust the loan criteria in line with higher credit risk.
Higher risk means a client would receive lower loan amounts, helping Monix control bad debt, she said.
