While MSME lending will remain the core business for Indifi, the digital lender plans to explore opportunities in sectors adjacent to lending, Alok Mittal, co-founder and managing director, told FE.Mittal believes the impact of the hike in risk weights on unsecured credit needs to be watched. “We’ll wait and watch to see what that means for us.”He said a reasonable part of the unsecured lending is driven through payment flows – credit card gateways, online gateways or UPI transactions. “We have built an ability to lend by using the footprint of those payments. So, these are some of the adjacent spaces where we are seeing linkages to digital credit and the idea will be to explore these,” Mittal said.

Co-founders Alok Mittal and Siddharth Mahanot will now focus on driving products and segment expansion. “Our customers have been asking for products besides unsecured lending, such as more transaction-linked products and more secure products, which come at a lower price. The intent is to go and build some of those offerings,” Mittal said in an interaction.Indifi primarily lends to the MSME sector, such as kirana stores, mobile phone stores, apparel stores, traders and wholesalers, who typically have a turnover of Rs 50 lakh to Rs 10 crore per year. Its average ticket size is Rs 7 lakh for a tenure of 25-26 months, with the interest rate ranging from 16% to high 20s, depending on the risk profile.Much like traditional NBFCs, most digital lenders are also struggling with the increasing cost of funds, which has risen by 30-40 bps between Q1 and Q3 of the current financial year. However, for Indifi, Mittal said the cost of funds has reduced on a net basis over the year.