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Buy Now, Pay Later: EarlySalary Buys Out CashCare

A new deferred payment solution for online purchases is to be proposed in India as the consumer lending market sees EarlySalary acquire CashCare. EarlySalary expands their field of action through providing themselves with a “Checkout Finance” product as well as with partners likely to attract young workers, i.e.: their core targets.

EarlySalary was founded in 2015 and specialised in instant salary advance for young workers (Millennials). They rely on a dedicated app to lend up to 50% of their monthly wages near instantly (maximum 2,500 euros). Their customers take 30 days on average to pay back this loan (repayments can be spread over 7 to 90 days).

Their scoring process leverages proprietary Machine Learning algorithms to scan data regarding the customer’s purchasing history and digital life. This analysis sets a “SocialWorth Score”, allowing EarlySalary to address young workers who do not yet have a credit history.

EarlySalary crafted a rather marginal “pay later” online solution in partnership with Amazon and Big Bazaar which accounts for roughly 1,000 applications per month. As they acquire CashCare, they expect this business to grow strong. They will, for instance, have access to CashCare's partner e-merchants, including ShopClues, Jabong, Byju’s, HP and MakeMyTrip.

Comments – Instalment Payment to assist an expanding e-commerce sector

EarlySalary expects this acquisition to strengthen their set of offerings on an increasingly prevailing segment in India, i.e.: spread payment options, especially considering that the local e-commerce market is fast gaining momentum (+30% per year, and revenue likely to reach $200 billion by 2026). This start-up currently manages 30,000 lending applications each month, for 6 billion rupees (about €76 million). They intend to handle 100,000 loan applications per month by next year (60 billion rupees).

EarlySalary recently raised $15.7 million and deems they could achieve “unicorn” status this same year, alongside Flipkart, PayTM or Ola Cabs.

Since the e-commerce market shows signs of strong growth potential, more online lending platforms have seen the day in India. For instance, EarlySalary challenges Zest Money, which just introduced a financing offer for professional education purposes. EarlySalary bets on a faster application process for their lending solution to make the difference: the entire process would only take 10 minutes for new customers, and instant decisioning applies for existing customers.