Credifin is a leading provider of financial solutions that empower individuals and businesses to achieve their goals. Activating leadership, living diversity, customer centricity, striving for excellence, demonstrating integrity, sustainability are their core values.
In a recent interview, Abdullah interacted with Shalya Gupta, CEO, Credifin Limited in which he discussed about the biggest hurdles facing EV adoption, collaboration with OEMs to ensure financing solutions are accessible and tailored for their customers, innovative financing products or schemes, financing models make EV ownership more affordable and appealing, key factors they consider when partnering with EV manufacturers.
What are the biggest hurdles facing EV adoption, and how is your company addressing these challenges?
- EVs have a limited driving range, so it`s difficult to travel to long distance. The product therefore becomes ineffective for people who are in some kind of marketing or sales job, because they need wider range for Travel.
- The price of electric vehicles (EVs) tends to be significantly higher than that of traditional gasoline-powered vehicles, which raises concerns about accessibility and affordability for the average consumer. This often acts as a barrier for many potential buyers, who may be interested to transition to more sustainable transportation options but find the initial investment prohibitive. Additionally, while there are various government incentives and rebates available, aimed at reducing the financial burden of purchasing an EV, these measures may not fully offset the high purchase prices, making affordability a critical issue that needs to be addressed for broader adoption of electric vehicles.
- The quality of vehicles stands as a paramount concern, particularly in the two-wheelers and e-Rickshaws segment.
In the coming year, we are excited to embark on a transformative project aimed at developing a comprehensive public charging infrastructure for electric vehicles. This initiative is designed to alleviate the widespread concern of range anxiety, a significant barrier inhibiting potential electric vehicle users from making the switch to cleaner, more sustainable transportation options. By providing a network of easily accessible charging stations, we will not only enhance the choices available to customers, enabling them to charge their vehicles conveniently while going about their daily lives, but also stimulate local economies.
As financiers in this dynamic market, we prioritize collaboration only with reputable brands that are known for their quality standards. This strategic partnership not only ensures the longevity and reliability of the vehicles we support, but also guarantees that our customers receive optimal value for their investment. By aligning ourselves with trusted manufacturers, we are committed to delivering products that enhance customer satisfaction and provide a sustainable solution for their transportation needs.
How do you collaborate with OEMs to ensure financing solutions are accessible and tailored for their customers
We take great care to customize our financing solutions based on the minimum usable life of the asset in question. Additionally, in the case of commercial vehicles, we thoughtfully calculate the equated monthly instalments (EMI), so that it aligns closely with the minimum expected income that our customers can derive from operating the asset. This careful alignment is crucial, especially considering the typically high costs associated with acquiring a vehicle. If there is a disconnect between the EMI and the income ratio, it could result in lower adoption rates of electric vehicles, as customers may find themselves compelled to revert to traditional internal combustion engine models that may seem more financially viable. By strategically mapping the EMI to the individual’s income, we aim to create a scenario, where potential buyers feel more empowered and encouraged to transition towards electric vehicles, recognizing them as a feasible and attractive option for their transportation needs.
Can you share details about any innovative financing products or schemes your company has introduced specifically for EVs?
In the commercial vehicle sector, we are excited to announce the introduction of an innovative financing scheme that goes beyond traditional support. This program not only covers the financing of the primary battery for the vehicle—which is crucial for its initial operational lifespan—but also extends its benefits by facilitating the purchase of a second, refurbished battery. Once the first battery has reached the end of its usable life, customers can seamlessly transition to the new battery that we provide on the very same day.
This initiative is designed to alleviate concerns regarding vehicle reliability and battery lifespan, allowing customers to enjoy uninterrupted performance without the stress associated with sourcing a replacement battery independently. From day one, we empower our customers with essential knowledge, informing them that the longevity of their vehicle is not solely tied to the lifespan of its battery. Instead, they can proactively replace the battery to rejuvenate their vehicle’s performance. This approach effectively doubles their return on investment, as they are not limited to the initial battery lifespan but can continuously enhance the vehicle’s operational life through our sustainable battery replacement solution.
Many customers find EVs expensive upfront. How do your financing models make EV ownership more affordable and appealing?
As discussed, we have many options available that ensure that the costing becomes optimal for our customers, especially those in the commercial EV segment like eRickshaws and eLoaders.
In addition, funding the second battery of the commercial vehicle, makes it an attractive option for our customers.
EMI of the EV to the customer is in correlation to their income generated from the asset or their income in general, which makes it more affordable/appealing to the customers.
We also provide used EV vehicles financing facilities for promoting EV`s.
How do you ensure financing options are available for smaller, budget-conscious buyers or rural customers who might have limited access to traditional financing?
We boast of a considerable and diverse customer base within the rapidly growing E-Rickshaw sector. In addition, we are extending our reach into the electric vehicle (EV) two-wheeler market.
Our outreach efforts are particularly centred around budget-conscious buyers and rural residents, many of who encounter significant barriers to accessing conventional financing solutions. By honing in on this specific demographic, our business model is strategically designed to cater to their unique needs, primarily focusing on financing income-generating assets. This approach not only provides these customers with accessible financing options but also plays a vital role in improving their overall quality of life. For instance, the ability to purchase an E-Rickshaw or an EV two-wheeler empowers them to increase their mobility, thereby enhancing their ability to earn income and support their families, all while contributing to a more sustainable and eco-friendly transportation solution.
What solutions do you offer for businesses looking to transition their fleets to EVs?
Currently, we are not focused towards fleet business
What are the key factors you consider when partnering with EV manufacturers?
While considering our partnerships with EV manufacturers, we consider the following factors:
- Product quality and innovation
- Financial stability and market reputation
- The ability to ramp up production as demand increases
- Whether the manufacturer offers competitive pricing to make EVs affordable for different customer segment.
- Whether EV manufacturer meets emission standards, safety requirements and other industry regulations(ICAT Approved)
- Whether the value of the vehicle is properly aligned with its price
What message would you like to share with OEMs, EV users, and potential customers about the future of EV financing?
For Original Equipment Manufacturers (OEMs), there exist three critical challenges that customers are currently grappling with: quality, pricing, and knowledge.
To effectively address these issues, it is imperative to provide comprehensive education to customers about the proper and efficient utilization of their vehicles. This educational initiative can be successfully implemented by equipping dealerships with the necessary tools and resources through robust training programs, as well as developing Standard Operating Procedures (SOPs) that prioritize customer satisfaction and experience.
When it comes to quality, it is essential that the durability and lifespan of the vehicle exceeds that of the battery. In addition, after-sales support is paramount; it is through well-trained dealerships that this support can be achieved. Dealerships need to maintain a steadfast commitment to quality. While some may be tempted to engage with transient, fly-by-night operators who may offer quick sales and easier onboarding processes, it is crucial to understand that such choices can ultimately undermine brand integrity and customer trust.
Pricing emerges as one of the most significant concerns for electric vehicle users. The lack of standardized pricing practices complicates matters, leaving customers feeling cheated, particularly when there are price discrepancies associated with changes in dealership or comparisons made across different locations and dealers. It is vital to ensure that the value of the vehicle is perfectly aligned with its price, thereby eliminating any potential for pricing manipulation and fostering a transparent marketplace. By addressing these pricing concerns, we can help instill confidence in customers and encourage wider adoption of electric vehicles.
Electric Vehicle (EV) Users – The transition towards electric vehicles is likely to become more cost-effective in the near future, making it an attractive option for a much wider audience. Investing in EV technology represents not only a crucial step towards fostering a more sustainable and environmentally friendly planet but also a financially prudent choice that can lead to long-term savings for the user. It is vital for users to grasp the essential guidelines and best practices associated with operating electric vehicles, as these machines operate quite differently from traditional internal combustion engine vehicles. Understanding the intricacies of charging, maintenance, and driving behaviour particular to EVs can greatly enhance the ownership experience while maximizing efficiency and longevity.
Potentials Customers – The shift towards electric vehicles (EVs) has transcended mere environmental concerns; it now represents a significant economic opportunity for consumers and businesses alike. With innovative financing solutions emerging, traditional barriers to EV adoption—such as upfront costs and financing complications—are being dismantled, providing consumers with enhanced flexibility, affordability, and peace of mind in their purchasing decisions.
It is crucial to tailor vehicle choices to your daily requirements, ensuring they align with your lifestyle and preferences. To guide this decision-making process, we can employ the 90:10 rule: if an electric vehicle meets the driving necessities for 90% of your routine, it becomes an advantageous option, even if it may not accommodate specific scenarios – like long-distance trips – 10% of the time. This statistic is especially pertinent; if consumers perceive that they might need a vehicle that performs outside typical usage, they are less likely to consider an electric option. However, it’s essential to recognize that, despite its limitations, an electric vehicle can effectively address the majority of daily drives and enable significant savings on fuel and maintenance costs over time.
Additionally, we are witnessing a substantial transformation in charging infrastructure, particularly in the realm of fast charging stations. This development is pivotal as it alleviates range anxiety, a common concern amongst potential EV users regarding the vehicle’s ability to travel long distances without frequent recharging, by offering more accessible and quicker charging options. As this network expands, consumers can expect improved convenience and efficiency, ultimately enhancing their investment and addressing that 10% concern more effectively, leading to greater adoption of electric vehicles in the years to come.
Some companies are bundling EVs with energy solutions, like solar panels or home charging stations. Does your financing model support such integrated offerings
We are committed to establishing and financing a comprehensive ecosystem for the electric-powered sector. Our focus extends beyond just electric vehicles to incorporate a wide range of renewable energy solutions, including solar panels and inverters, while also exploring the potential integration of battery storage systems in the near future. As an organization, our objective is to develop a sustainable financial model that is both affordable and accessible for our customers.
To achieve this, we aim to thoroughly analyse the entirety of costs associated with the ecosystem that a customer may be interested in adopting. This involves evaluating how their expenses relate to their overall income in a way that justifies the monthly instalments (EMI) they will incur. Importantly, we are committed to ensuring that the total cost of integrating this electric ecosystem is not only competitive but ideally lower than or equivalent to what the customer would have spent under conventional energy systems. By doing so, we strive to create a compelling value proposition that encourages the transition to sustainable energy solutions, ultimately benefiting both our customers and the environment.
Are there any regulatory gaps that you believe need immediate attention to boost EV adoption and financing?
As our country is in growing stage in EV industries, a few parameters we need to be focused on
- There is lack in law enforcement for EVs
- Need to facilitate Public Private partnership for better reach to consumer
- Need to develop strict guidelines for battery recycling, by establishing mandatory recycling programs and incentivizing manufacturers for the same.
- Rules and regulation for EV protocols should be standard, across the country
- There should be strict policy implementation for registration of vehicles and penalties for non-registered vehicles in high speed category
- Compulsory Insurance of the vehicle, which is essentially non-existent today, especially after the first year
- Standardised policy for movement of commercial electric vehicles, especially in the E Richshaw category as the country is moving towards adoption of electric vehicle. The local unions and the local municipalities make different rules which are not in correlation with the national mission.
Where do you see your company and the EV financing industry in the next decade?
The next ten years will witness a collaborative and transformative evolution, during which the realms of technology, policy frameworks, and market dynamics will intertwine in unprecedented ways to enhance the affordability and accessibility of electric vehicle (EV) ownership. Organizations and financial institutions that actively adopt cutting-edge innovations, place a premium on sustainable practices, and cultivate partnerships across various sectors will distinguish themselves as frontrunners in this swiftly growing market. This convergence is expected to yield a transportation landscape that is not only significantly greener, minimizing carbon emissions and promoting environmental health, but also one that contributes to a more inclusive and resilient global economy—supporting economic growth and job creation across diverse communities. Consequently, we can anticipate a substantial increase in the sale of electric vehicles, reflecting a greater societal shift towards cleaner, more sustainable modes of transportation that are available to a broader demographic of consumers.
Our company is already growing at a brisk pace and we aim to continue with the momentum over the next 10 years. We have been the frontrunners in product design and product innovation and using technology to ease the whole process and this will remain our core.