The Need: Doing business but not getting paid. One of the biggest impediments to the $ 1.5 trillion B2B commerce growth in India is the availability of authentic and complete information to allow credit. Most transactions are on clean credit based on very informal sources of references and incomplete or inaccurate information.
Globally credit is an unsolved issue for the B2B economy exceeding $15 trillion.
Sample India problem numbers
India’s banking industry: $ 1.23 trillion
Current bad loans (4.6%) : $ 48 billion ( >100 billion :11% if including stressed loans)
India’s Private Industry
Bad Debt as % of net profit : 10-15%
Delayed Payments : Minimum 50% of sales
A small retailer with sales of Rs. 1 crore/year will be loosing minimum Rs. 50,000 annually as bad debts. Additionally the time and interest loss in delayed payments.
Ridhi Doongursee, Founder at CreditMonk.com was born and schooled in Mumbai, moved to England for further studies at 17. She studied During Computers and Business, at The University of Warwick and Warwick Business School, interned at UBS in London, and joined UBS full time following graduation. Thereafter moved back to India, worked in family owned businesses, launched a healthier deodorant brand, and decided to launch CreditMonk.com to solve credit – the biggest issue faced, for growth in the B2B space.
Enter Big Monk: Working in the B2B space for many years, a key issue was the absolute helplessness of business owners in getting their payments on time.
“Late payment is the silent killer of a business. “ Having worked with large-scale industries, the issue is huge and lowered our profit margin way more than it should. At times, it felt like she was a private bank for customers.” After trying multiple things and absolutely failing, the idea of CreditMonk was a eureka moment.
The Solution: At CreditMonk.com we seek to make credit a good word!
Team CreditMonk: A small but super dedicated team of tech and support moderators who love the fact that they will make it way easier for people to do business. And a bigger team of shared resources to ensure we have access to the best support, advice and scalability that we have no doubt we will soon need.
The Guiding Principles:
The CreditMonkGoal – CreditMonk strives to make credit a good word. We hope to be a one step check to understand a company’s market reputation in terms of payment habit, usual credit given and other credit related information. We want to make it easier to do business so the focus can be shifted from getting paid, to giving great service and products!
Being fair is important to us
We follow these simple guiding principles to ensure that first hand, valuable credit information is available to businesses while ensuring there are safeguards and options to improve for the companies being reviewed.
- We never edit or alter content submitted on our site.
- We never suppress, filter or delete content simply because it is negative/lower-rated, or positive/higher-rated.
- We apply the same standard of review for all content (whether or not the content concerns an employer client of CreditMonk).
- We remove content if we have evidence that members were incentivized to leave the content.
- We use technology filters & algorithms to detect fraud and gaming, and require email verification or a valid Facebook, Google + or Linked In account for all members submitting reviews.
- We moderate every piece of content through a two-step moderation process. The first gate of review is technological. We apply sophisticated technology that analyzes multiple attributes of the content. If the content does not pass technological review, a team of human moderators reviews the content to determine if it meets our guidelines. Additionally, a human always moderates any content that is flagged.
- We stay neutral in all cases of dispute and do not act as the finder of fact.
- We believe in the principle of anonymity if needed/preferred- everyone has a right to voice their opinion or be heard without fearing retribution or other unwanted attention.
- We believe each company has the right to respond to a review left by a member.
HOW IT WORKS
CreditMonk is a business, shared information network where you can rate the payment habit of companies you have worked with.
On CreditMonk.com the creditor decides their customers credit worthiness. You, the creditor can rate the payment habit of your customers and benefit from payment publicity to help ensure timely payment.
As reviews build up, you get real on ground credit report of companies and business reviews by other real creditors of the business. A free business credit review that can give you business critical information to decide your credit terms before you work with them.
Mr. Distributor has been in the business for 35 years and as competition has increased and margins reduced, payment delays have become too expensive to his bottom line. He is tired of credit issues and needs to keep calling up for references in the business to understand a customers market reputation and credit worthiness. Considering he gets most of his information from competitors, it might not always be reliable. He has developed high blood pressure in the last 5 years due to uncontrolled credit. Many of his valued customers have a good payment habit but those who don’t cause the bottom line to plunge.
Ms. Manufacturer has been manufacturing engineering products for 10 years and does not get paid for even 120 days by some customers. Her customers take product on credit, don’t pay when due, and if she refuses to supply until paid, they buy from her competitor who sells not knowing the payment issues he will also have to deal with. Legal recourse has yielded no benefit and proven to be time consuming and expensive. Bad debts are increasing year on year and causing her to believe its better to shut shop and leave this business.
Mr. Lawyer is a Lawyer spending many late nights completing urgent client work. In spite of 18-hour workdays, clients don’t pay and there is no time to keep calling and following up for payments. Many of his clients pay on time but those who don’t, add a high bad debt burden, which means precious time wasted.
They all sign up on creditmonk and decide to put up their reviews so that other people dealing with their debtors know the real picture about the payment issues – Good And Bad.
- For the good paymasters they put up positive reviews for their good business practices and ethics.
- For the bad paymasters they rate and review them negatively.
- Good companies get rated higher and get better credit terms and serve as a positive example to the market
- Debtors delaying payment get motivated to improve their payment habit
- Management notices what they might not be aware of
- Companies who have a “Do a case, we don’t care” -Bully companies due to concern of public shaming start taking notice of their payment habit
They also discover the benefit for company owners to:
- Claim their profile and add/amend information
- Reply to reviews and comments about their companies
- Review other companies they transact with
- Invite their suppliers/people they work with to review their company