ZestMoney, India’s leading AI-driven EMI financing and “Buy Now Pay Later” (“Pay Later”) platform has observed a 500% month-on-month growth in customers opting for the Pay Later solution for Electric Vehicles (EV). The number of EV dealers on ZestMoney’s platform have increased from 300 in July to 4,500 in November.
The demand for electric scooters has increased over the last few months as people want to own a personal vehicle. With COVID-19 and need for social distancing, people are opting for low-cost electric vehicles to meet their transportation needs.
ZestMoney has observed that Uttar Pradesh contributes 30% to the total business from EV, followed by the states of Bihar, Rajasthan and Maharashtra. The purchases are largely within the age group of 25-35, with 10% of women opting for EV scooters.
Interestingly, EVs are gaining increasing traction in Tier II, III and IV towns where many new-to-credit customers are opting for the convenience of Pay Later solutions. These markets are driving 70-80% of the total demand.
Low Speed scooters that pick-up speed of 25 km/hr and do not need registration with the transport authorities constituted 90% of all the electric two-wheelers sold in FY19-20. While many traditional financiers are averse to financing the electric scooters which do not have the registration number, ZestMoney has gone and the Pay Later financing available for this segment of EV – the first of its kind financing in this space.
Commenting on the development, Lizzie Chapman, CEO & Co-founder at ZestMoney said, “The pandemic has augmented the demand for electric vehicles with people wanting to skip public transportation. At ZestMoney, we see a massive opportunity in financing for this segment, particularly in smaller towns where customers may not have a past credit record or a traditional credit score. Our Buy Now, Pay Later solution offers them the perfect flexibility to spread the cost which is great financial planning too. Since many are availing credit for the first time, we are helping them build their credit score for large ticket loans they may need later. The EV industry is taking shape and we at Zest strongly believe that despite COVID-19, FY 20-21 will be a defining year for the EV segment.”
Customers can avail a credit limit from ZestMoney by completing digital KYC (online or in-store) and choose a repayment plan of their convenience at the time of purchase. The process to avail the service is completely paperless, end-to-end digital and can be done with no manual intervention required. ZestMoney eliminates the need for a guarantor and any pre-closure fees.
ZestMoney partners with Original Equipment Manufacturers (OEM) of EVs to finance their vehicles through their dealership network. Any customer that visits these approved dealerships to purchase an EV, can avail the financing option offered by ZestMoney. The company is associated with over 20 marquee brands in the EV space, including Hero Electric, Revolt, Okinawa, YObykes, Tunwal, BattRE, EeVe India among others.
According to Avendus Capital, EVs in India could represent INR 500 Bn opportunity by 2025. The central government’s push in the form of subsidies and tax benefits is playing a crucial role to drive adoption for the segment.