LenDenClub, a regulated peer-to-peer lending platform, has expanded its focus on technology and automation since 2021.
The company now uses over 20 AI and machine learning models to support credit assessment, borrower-lender matching, and collections.
After reporting a ₹34 crore profit in FY25, it is strengthening its position across its P2P, loan service, and technology service businesses under the Vartis Platforms umbrella.
As the P2P industry faces closer regulatory scrutiny and concerns over asset quality, Dipesh Karki, Co-founder and CTO at Vartis Platforms, discusses the company’s approach to AI adoption, compliance, profitability, and operational risk management.
Here are the excerpts from the interview
Invezz: LenDenClub has invested heavily in AI, automation, and data models since 2021. How central have these innovations been in transforming your operations and customer experience?
Since 2021, AI, automation, and advanced data models have been pivotal in transforming LenDenClub’s operations and customer experience.
Our platform now leverages 20–25 AI and ML models for credit assessment, borrower-lender matching, and collections, enabling faster, more accurate decisions.
Loan applications are assessed within seconds, and predictive models forecast repayment behaviour with 95–96% accuracy, allowing proactive follow-ups and efficient recovery.
Automation simplifies complex workflows, such as spreading funds across multiple borrowers in one step, reducing manual effort and errors.
Together, these innovations enhance transparency, speed, and reliability, ensuring a seamless experience for borrowers and lenders while maintaining low NPA rates and building trust across the platform.
Soon, we are going to launch our first app where 100% coding is done by AI only. Only partly code review is done by our engineers. That’s how we have been excelling in adopting AI in our regular work.
Invezz: You are currently testing generative AI tools for lenders. How soon can we expect a public rollout, and what measures are you taking to ensure accuracy and compliance in sensitive financial communication?
We are in the advanced stages of testing generative AI tools designed to assist lenders, with a public rollout expected in the next 2 quarters, given the sensitivity of financial communication.
To ensure this, all AI outputs undergo strict regulatory checks and are aligned with RBI guidelines.
Our models are trained on anonymised, high-quality data and continuously monitored for consistency and correctness.
Additionally, human oversight will still be there in the starting phase. As and when AI is moving towards AGI, the human oversight will go down. However, yet, there is no visible timeline to achieve that.
Invezz: FY25 marked a turnaround with a ₹34 crore profit. How is FY26 shaping up financially? Can profitability be sustained in the current environment?
FY26 for us is shaping up positively, building on the strong FY25 turnaround where the company posted a ₹34 crore profit.
We are leveraging our diversified model spanning P2P lending, Loan Service Provider (LSP) operations, and Technology Service Provider (TSP) offerings, which now contribute meaningfully to revenue.
All these businesses are 100% platform businesses. We plan to add a couple of more platforms under our parent entity Vartis Platforms.
By vertically integrating each of these entities, bringing Operational efficiencies, disciplined cost management, and technology-driven processes, we are expected to not just support sustained profitability but also steadily increase it in the next couple of Days.
While regulatory compliance remains critical, LenDenClub’s early adaptation and robust risk management systems position it well to navigate ongoing market challenges.
We are prepared and have been following all the guidance from the regulator.
Invezz: Last year, 20% of your revenue came from the technology platform side. How do you see this mix evolving—could non-P2P verticals become as large as the core business?
The technology platform business is already proving its potential, contributing around 20% of group revenue in FY25.
We see significant scope for this mix to grow, but it will takea couple of years to grow this percentage within the group revenue as other entity revenues are growing at an even faster pace.
Invezz: The RBI returned your NBFC license application last year. Do you think the regulator is fundamentally wary of granting NBFC status to P2P players, and is there any plan to revisit the application?
The RBI returning our NBFC application last year reflects the regulator’s cautious approach towards granting another regulated entity to the same group, given the unique risk and operational considerations in this segment.
That said, the application was not rejected, and the regulator’s decision can be revisited in the future if the sector’s framework evolves.
At present, our focus remains firmly on strengthening and scaling our core platform businesses, ensuring full compliance with existing guidelines of regulated business, and building a sustainable, diversified digital credit ecosystem.
We have no immediate plans to resend the application for an NBFC license, as our priority is to deliver value to borrowers and lenders within the current regulatory framework.
Invezz: Bad loans across the P2P industry have surged, with some reports showing it has exceeded 17% of total lending by 2024. How has LenDenClub managed to keep its own asset quality in check, and what protections do lenders on your platform have?
Let me start with the number first. Despite industry-wide challenges, at LenDenClub, we have maintained 3.7% of NPA since inception.
Every borrower undergoes KYC verification, credit bureau checks, income assessment, and behavioural analysis, while proprietary AI models analyse hundreds of data points to forecast repayment behaviour and flag potential defaults early.
For overdue loans, automated reminders, telecaller follow-ups, and legal escalation are implemented.
Lenders are protected through mandatory diversification across multiple borrowers, secure escrow accounts, RBI-mandated lending caps, and transparent reporting.
While no platform can fully eliminate default risk, these measures, combined with strict regulatory compliance and active monitoring, ensure that lenders can participate in P2P lending with confidence and informed decision-making.
We were quite early in building the AI team within our engineering team, which was way back in 2021. It is giving us results now.
Regarding the 17% NPA number at an industry level, it’s the wrong way of looking at it. For P2P lending platforms, NPA numbers should be looked at from an overall origination perspective.
That’s the global practice. However, in India, a few times, people are comparing it at an AUM level.
Any P2P platforms’ AUM which is under rundown, NPA will keep growing and hit 100% some day. It’s a little technical to explain here.
However, that’s the wrong way of looking at it.
Invezz: Since the August 2024 guidelines, P2P platforms have faced significant restrictions. How do you balance compliance requirements with the need to innovate and scale?
At LenDenClub, we don’t see those as a restriction. Any new regulatory sector will witness such an evolution of regulations and products.
It’s a part and parcel of life. The August 2024 RBI guidelines have prompted us to enhance our technology and processes in such a way that it gives more power to the users coming to the platform.
It also brings much more transparency of NPA disclosure and the way user portfolio level data is shown.
By integrating compliance into our core operations rather than treating it as an add-on, we can scale sustainably, maintain trust, and continue leading P2P lending in a safe and transparent manner.
Invezz: Do you see P2P lending evolving into a mainstream credit channel in India, or will it remain a niche alternative to banks and NBFCs?
It is already. There are 1.5-2 lakh borrowers who are given loans by P2P lending platforms every month across India. Isn’t this number sizable?
From an industry standpoint, peer-to-peer lending in India is emerging as a regulated and specialised credit channel rather than a full-scale alternative to banks and NBFCs.
The sector’s growth is being driven by rising digital adoption, with over 886 million internet users, and it focuses on small ticket size borrowers or new to credit customers or small businesses.
P2P platforms are increasingly serving the younger demographics, such as millennials, Gen Z, and also the underserved MSMEs, bridging gaps in small-ticket and short-term lending.
While it will remain a niche segment, P2P lending enhances financial inclusion through faster, tech-driven credit access, flexible lending options, and AI-powered risk management, making it a valuable addition to India’s broader credit ecosystem.
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