Prest Loans, a Dehi-based, fast-growing digital lending company (www.prestloans.com), has entered the electric vehicle financing market (EVs).
It has partnered with Terra Motors, a leading Japanese manufacturer of electric vehicles, to provide high-quality products, and with Mumbai-based Eqaro Guarantees to provide credit default insurance. This will enable it to provide simple, fast, and affordable financing to purchasers of electric vehicles (EVs), which will have a positive impact on their lives. The entire credit facility provision process shall be automated and user-friendly in light of these borrowers’ profiles.
It intends to form strategic alliances with additional manufacturers and last-mile delivery service providers.
Loans from Prest to promote self-employment and clean energy initiatives.
Prest views the electric vehicle segment as a massive opportunity over the next five years.
Under the terms of an existing agreement between Prest Loans and Eqaro Guarantees, Eqaro also provides credit default guarantees for loans made by Prest to small businesses and micro, small, and medium-sized enterprises. The new initiative will contribute to the expansion of the company’s offerings.
Prest Loans will finance approximately 70% to 80% of the value of electric vehicles. Prest Loans already have a risk-based scoring mechanism called the ‘Prest Score’ that analyses the borrower’s profile based on non-financial parameters, and the risk engine determines the rate of interest and loan term.
Eqaro Guarantees provides credit default insurance on loans made by Prest Loans for the purchase of electric vehicles, while the manufacturers provide a quality and buyback guarantee on repossessed vehicles in the event of default. The guarantor’s presence increases lender confidence, which benefits the borrower through lower interest rates, longer repayment terms, and lower EMIs.
The product is targeted at borrowers of both passenger and cargo-carrying electric vehicles, such as E-rickshaws, E-carts, loaders, and delivery vehicles. The arrangement is aimed at providing credit default guarantees to individuals and corporate entities interested in purchasing new electric vehicles and receiving hassle-free funding from Prest Loans.
In aggregate, the guarantees help make credit available to a segment of the population that has been disproportionately impacted by the pandemic in terms of job losses and migration. While the electric vehicle industry is also struggling, it has the potential to improve the livelihoods of the poor and migrant workers by assisting them in purchasing and operating EVs in their communities.
According to Ashok Mittal, CEO of Prest Loans, “In India, e-vehicles are a new segment to finance. It lacks lender confidence because there is no developed market for pre-owned E-vehicles or predictable prices for used E-vehicles. Having a credit default guarantee helps mitigate risk and instils confidence in lenders. Our fundamental philosophy of promoting self-employment and making a positive impact on society will be strengthened further by this guarantee arrangement. We see the electric vehicle market expanding exponentially over the next five years and would like to contribute to that growth.”
According to Vikash Khandelwal, CEO of Eqaro Guarantees, “We are pleased to partner with Prest Loans and Terra Motors to provide financial default guarantees that will assist institutional and individual borrowers in obtaining credit for the purchase of electric vehicles. Financial Default Guarantees assist borrowers in enhancing their creditworthiness and obtaining more favourable terms for their borrowing programme from a broader pool of lenders. India’s electric vehicle market represents a massive opportunity. Our guarantees will bolster the government’s push for green mobility and contribute to the acceleration of the adoption of electric vehicles.”
Terra Motors CEO Ahikiro Ueda stated, “Terra Motors’ affordable, high-quality EVs combined with Eqaro’s credit default guarantees will expand opportunities and incentives for all segments of the Indian potential user to purchase EVs. It will be a significant step toward establishing a much safer and healthier way of life.”
Prest Loans, a trade name of RBI-registered non-bank financial company Lord Krishna Financial Services Ltd., is India’s largest and fastest-growing online lending and financial services provider, headquartered in Delhi.
The Company’s primary objective is to provide financial assistance in the form of business loans, SME loans, and electric vehicle (EV) loans in order to promote and support self-employment and make a positive impact on society for the underserved segment primarily operating in the North Indian market.
Eqaro Guarantees provides financial security to project owners, supplier principals, and brand owners alike, shielding them from financial exposure to their contractors, clients, dealers, or franchisees.
The company, a pioneer in India’s surety industry, is committed to providing innovative and customised bonding solutions. Their strengths include expert underwriting and a thorough understanding of the Indian infrastructure and financial services industries. The company is backed by Ion Insurance Company Inc (USA), Southern Pacific Insurance Corporation (USA), and Northern Light Surety Company SRL, all of which have financial strength and global expertise.
Terra Motors’ mission is to “create new industries and improve the convenience of society.” Terra Motors is a Japanese joint venture that aims to be a market leader in sustainable e-mobility by developing, manufacturing, selling, and servicing electric vehicles (electric two-wheelers and three-wheelers). Apart from its headquarters in Tokyo, the company operates in three other Asian countries.
Terra Group believes that by pursuing their goals, they are able to contribute to the creation of job opportunities for low-income people worldwide, their personal development, and the realisation of a prosperous society.
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