Jar Eyes Expansion into P2P Lending, Initiates Product Testing for Specific Users

Jar is an investment tech platform that offers innovative products for savings and investments. Founded in 2021, it aims to help users become financially independent by cultivating a savings habit and investing in digital gold. The platform provides a seamless way to participate in the tradition of saving in 24 Karat gold at 99.5% purity, with a focus on building wealth and security for users and their families. Additionally, Jar employs tech-driven solutions to offer innovative investment products via its digital platform, catering to the modern-age fintech space.

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Jar, an investment technology platform, is reportedly venturing into the peer-to-peer (P2P) lending arena with its latest offering called ‘Jar Plus’.

According to reports from Moneycontrol, this fresh addition to their lineup is being introduced through a collaboration with LenDenClub, a non-banking financial company (NBFC) based in Delhi NCR. It’s worth noting that the product has already made its debut among a select group of users.

For those unfamiliar with the concept, P2P lending facilitates direct connections between lenders and potential borrowers. In this scenario, Jar takes on the role of sourcing customers, while the NBFC collaborates by pooling funds from lenders and subsequently disbursing them to carefully assessed borrowers.

Jar Plus is currently undergoing rigorous testing and is being gradually introduced to a select group of customers within the Jar platform. At this stage, the company is actively gathering feedback from users and promptly incorporating it into further developments. According to a report, the rollout process is ongoing and will require additional time to reach completion.

Established in 2021 by Nischay AG and Misbah Ashraf, Jar operates a user-friendly platform that empowers individuals to invest with as little as INR 1. Notably, in 2022, the company successfully raised $22.6 million in its Series B funding round, valuing the enterprise at approximately $300 million. This significant investment came from prominent backers such as Tiger Global and Eximius Ventures, highlighting the confidence placed in Jar’s vision and potential.

The fresh addition is poised to assist the fledgling business in enhancing its revenue streams and curbing financial losses. In the fiscal year 2023, the startup experienced a notable 77% increase in losses, reaching INR 122.8 Cr, despite a surge in operating revenue from INR 73.8 Lakh in FY22 to INR 8.7 Cr.

What’s intriguing is that this collaboration isn’t LenDenClub’s maiden venture into fortifying its P2P lending endeavors. Noteworthy entities like BharatPe, Google Pay, PhonePe, and Karza stand alongside it as partners in this domain.

This development marks Jar’s inclusion into a burgeoning cohort of Indian startups venturing into P2P lending to diversify their income sources. Notably, fintech heavyweights such as CRED introduced the P2P lending product Mint for its members in 2021, while BharatPe ventured into the same sphere with 12% Club in the identical year.

In the past year, the fintech startup Uni Cards made a notable move by acquiring OHMY Technologies, a company licensed by the RBI. This strategic acquisition was aimed at expanding Uni Cards’ offerings to include P2P lending products.

This development unfolded amidst increased scrutiny from the central bank on the fintech sector. As regulatory measures tightened, digital lending faced closer examination. Specifically, P2P lending drew attention due to concerns surrounding inadequate KYC procedures and a lack of adherence to regulatory guidelines.

Significantly, the RBI has been actively engaging with licensed P2P platforms. Since September, it has conducted supervisory visits to their offices, as reported by Moneycontrol.

The fintech landscape is evolving rapidly, and Uni Cards’ acquisition of OHMY Technologies underscores the dynamism within the industry, as well as the importance of compliance and regulatory oversight.

Jar, an investment technology platform, is introducing ‘Jar Plus,’ a P2P lending offering in collaboration with LenDenClub. This initiative facilitates direct connections between lenders and borrowers and is currently undergoing testing and gradual rollout. Despite a surge in operating revenue, Jar experienced significant losses in fiscal year 2023. This move aligns Jar with a growing cohort of Indian startups entering P2P lending, aiming to diversify income sources. Additionally, regulatory scrutiny, particularly regarding KYC procedures and adherence to guidelines, emphasizes the importance of compliance and oversight in the dynamic fintech landscape.