In our previous blog, we did a comprehensive study on the SWOT Analysis of the largest broadband communication company in the United States, Spectrum. Here we will understand the SWOT Analysis of Finzy.
The objective is to help you throw light on Finzy which connects personal loan borrowers with investors and makes borrowing and investing easier through digital mediums.
Another aspect that made Finzy the massive it is now, is its marketing efforts. As the world goes online, marketing is changing and if you are curious in learning about the latest – check out our Free MasterClass on Digital Marketing 101 by the CEO and Founder of IIDE, Karan Shah.
In this case study, we will learn about the SWOT analysis of Finzy. But first, let us know about the company and the product better.
About Finzy
Finzy was founded in 2016 by the founder Amit More with an ambition to make the entire borrowing process simple and user friendly for the ones who are in need. Finzy is a seed company and the employee strength at Finzy is 11 to 50. Finzy strives to get borrowers the loan in the quickest turnaround time, at the lowest rate of interest and in a hassle-free manner. The team of Finzy are professionals who have excelled in their fields ranging across finance, technology, product, sales, marketing and leadership.
| Founder | Amit More |
|---|---|
| Year Founded | 2016 |
| Origin | Bangalore, Karnataka, India |
| No. of Employees | 11-50+ |
| Company Type | Private |
| Market Cap | N/A |
| Annual Revenue | $149K (2021) |
| Net Income/ Profit | N/A |
Products & Services by Finzy
Finzy has been in the loan industry and so it provides plans & services in-
- Debt consolidation loans
- Renovation loans
- Healthcare loans
- Auto loans
- Business loans
- Purchase loans
- Flexible loan amounts, terms, and repayment options
Competitors of Finzy
Finzy competes with many other loan providers. The top 5 competitors of Finzy are –
- CommonBond
- 4Finance
- Assetz Capital
- Afluenta
Now, we have a clear picture of the company’s core business. Let’s talk about the SWOT Analysis of Finzy.
SWOT Analysis of Finzy
A SWOT analysis examines the strengths, weaknesses, opportunities, and threats that a firm faces. SWOT Analysis is a tried-and-true tool that enables a company like Finzy to compare its business and performance to that of its competitors.
It will give us a strategic analysis of its internal and external environment, which is crucial for understanding the SWOT Analysis of Finzy.
To better understand the SWOT analysis of Finzy, refer to the infographics below:
Below is an explicit guide to the SWOT analysis of Finzy.
Strengths of Finzy
- Getting Funds: Peer-to-peer lending platform – Finzy is raising funding and recently it has successfully raised $2 million in a bridge round where larger fintech, including BharatPe and Cred, trusted the seed company and invested in it.
- Affordable Rate: Finzy is an RBI registered platform and it is providing quick personal loans at the lowest interest rates of 7.99 per cent per annum to help people tide over hardships caused by the COVID-19 pandemic.
- Tech Enabled: The loan provider prices its loans on the basis of the user’s inspection of a credit risk premium as confined by its internally generated credit algorithm which tests a customer reimbursement power against 130 different parameters ensuring Finzy does not get in huge amounts of lendings.
- Broad Range of Portfolio: One biggest strength that Finzy has is that it offers a wide range of loan services to its customers ranging from debt consolidation loans, renovation loans, healthcare loans, auto loans, business loans, and purchase loans with flexible loan amounts, terms, and repayment options.
- Automation of Activities: Successful automation of business loan activities with a well-developed IT structure and Infrastructure has made the overall efficiency better.
- Talent Management – Human resources are crucial to Finzy Ltd’s growth in the Consumer Financial Services market. The company employs a highly qualified team. This is due to their outstanding training and education programmes.
- Technology and Guidance: They use their application to provide loans so people don’t need to go outside for the loans and it also guides how to use the app. Also, Finzy guides its customers on how to use apps and how to process loans and how to pay the amount of a loan in instalments.
- User-Friendly Application: The digital application created by Finzy is user friendly that can easily be usable by users to get a loan. It is a 6-step process through which borrowers can easily get their loan funded in as little as 48 hours. The application makes the entire borrowing process simple and user friendly.
Weaknesses of Equitas Holdings
- Time Started: Company started in 2016 the company has only 6 years of experience compared to others it has less experience. Other companies like CommonBond are 3 years older than Finzy. The company needs more experience and more brand awareness.
- Marketing: The Finzy company doesn’t use digital marketing. They need to do brand awareness so that people will know the company exists and provide low-interest personal loans. Marketing is the thing that the company shouldn’t ignore.
- Legal Regulation: There are so many countries that consider soliciting investment from general people illegal. In short, many countries consider peer-to-peer illegal.
- P2P: There are lots of disadvantages of P2P lending. There is a credit risk, no insurance/government protection in P2P, legislation. Altho peer-to-peer provides a low amount of interest to borrowers and high returns to investors, it has lots of disadvantages compared to advantages.
- Low Investment in New Technologies: Given the scale of the expansion and the multiple geographic regions in which the company will expand, Finzy’s overall integrating processes require more money to be invested in technology. Current investments in technology are not aligned with the company’s vision.
- Falling Revenue: The company revenue for the Calendar Year 2020 dropped to USD 149K down from 209K in the Calendar Year 2019.
Opportunities for Finzy
- Reach Customers: Finzy should reach businesses that require loans for their business and make them a customer. Start-ups need loans to grow their business.
- New Customers Through Online Channels: The company has invested huge amounts of money in its online platform over the past few years. This investment opened up a new sales channel for Finzy. Over the next few years, companies will be able to seize this opportunity by better understanding their customers and meeting their needs through big data analytics.
- Technological Advancements: Technology provides various benefits in a variety of fields. Costs can be saved by self-operating. Technology allows for much better data collection on customers and improves marketing efforts.
- Government Support: The company should seek financial support from the government of India because the company operates in a sector in which the government involvement is very high. Finzy can get subsidiary support from the government.
- Interest Rate: Lower interest rates than compared to previous years provides an opportunity for Finzy to undergo expansion projects that are financed with loans at a cheaper interest rate.
Threats to Finzy
- Competitor Raising Funds: Finzy raised $502k in 2020 and it again raised $2M of the total fundraising in 2021. Finzy raising this huge amount of funds is threatening in terms of the company getting into huge debts.
- New Entrants: A mow down of new players have entered the market and are gaining market share taking up the market share of existing companies. Finzy faces a threat because these new entrants may steal its customers.
- Customer Reimbursement: Although, the company system is equipped with a robust credit algorithm analyser which tests users’ reimbursement power against 130 different parameters. But, if somehow the borrower fails to repay the debt in the allowed time frame would ultimately cost the company and investors getting into huge amounts of money lending.
- Competitor Technical Advancements: New technological progress by a few competitors within the sector constitutes a threat to Finzy since customers who are drawn to this new technology may switch to competitors, reducing Finzy’s overall market share.
- Lack of Proper Cyber Security Systems: The current financial industry relies entirely on the cyber-world. Whether it is data storage, monetary transactions, or personal information, everything is stored digitally. This makes the financial sector a primary target for hackers who are seeking to benefit financially by leveraging flaws in the financial’s digital infrastructure. Institutes need to take effective cybersecurity steps to safeguard their records, they will face a significant cyberspace threat.
This ends our extensive SWOT analysis of Finzy. Let us conclude our learning below.
To Conclude
Finzy is a loan institution providing consumer loans to the ones who need them. In the SWOT Analysis of Finzy, we observed that the company is yet to enjoy strong brand recognition and trust with its customers.
With increasing competition in a new vertical, companies are yet to learn how to fight their own battle by winning over their customers with better marketing efforts. In a changing world where digital marketing is of great importance, being well aware and having hands-on knowledge in the field is a must for all marketing enthusiasts.
If you are looking forward to making your career in digital marketing and are interested in learning more and upskilling, check out IIDE’s 3 Month Advanced Online Digital Marketing Course to know more.
We hope this blog on the SWOT analysis of Finzy has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
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