Real estate marketplace Housing.com has launched a new credit solution, Rent Now, Pay Later (RNPL), in India.
According to a news release, the RNPL solution, which has been launched in partnership with Niro, a Bengaluru-based embedded-financing startup, offers tenants the option to pay rent using credit. Users of Housing.com’s Edge platform — a dedicated segment for rental services — can now access the service with no convenience fee, interest-free credit for up to 40 days and the option to convert their rent into easy monthly installments (EMIs).
“India has become a trailblazer in the world of digital payments and we anticipate that services like RNPL will only continue to gain traction,” said Dhruv Agarwala, group CEO of Housing.com, PropTiger.com and Makaan.com. “This solution will bring genuine empowerment to millions of customers who desire to rent properties using credit but are often hindered by the lack of traditional instruments.”
Housing.com and Niro piloted the service for 100,000 users before the official launch. Borrowers can now extend their credit limit up to about $3,600 U.S. Housing.com had previously launched a service to let users pay rent by credit card. However, it failed to gain traction due to low credit-card usage in India (an estimated 4% of the total population). Likewise, as part of its Housing Edge offerings, the company launched Rent Protect Cover in partnership with insurtech platform Riskcovry after introducing a direct-owner-connect service. Agarwala recently said Housing.com the company intended to hire 200 additional employees during the current fiscal year.
The buy now, pay later (BNPL) model is increasingly visible in rental markets in many parts of the world. Examples include Jetty Rent in the U.S. and Rent.com.au’s Safety Net in Australia. Spain-based proptech startup WilGo is aiming to launch a similar service in the near future.
Unlike financial services providers, BNPL lenders (including RNPL providers) are largely unregulated. However, their detractors maintain that these businesses are exploiting vulnerable low-income consumers, so regulators are unlikely to ignore them indefinitely.
In FY2202 (the 12 months to July 20220, Housing.com parent company REA Group’s revenue surpassed A$1 billion for the first time. It posted moderate revenue growth but higher operating costs in the first half of FY2023 (the six months to December 2022).