Credit cards, including Visa and Mastercard, which we have probably heard a lot of, provide their owners with a worry-free shopping process.
Although many companies have made many efforts to provide this service in Iran in the past years, its implementation and hassle-free credit purchase with just one card is a dream that has not been realized yet.
According to the IDEA, in the last two years, Landtechs tried to fill this void of credit cards through micro-loans and giving credits as BNPL. Tara is also one of these companies. This company has focused its services on daily consumption goods, unlike other landtechs that target the purchase of durable goods.
Hamed Qanadpour, CEO of Tara, believes that according to the investigations, we realized that the way of providing facilities based on market segmentation was not done correctly. Based on this and considering various factors such as inflation and GDP, we realized that the provision of facilities is not according to people’s needs. In the field of Landtech, because we are dealing with collections that are data-driven, this issue is better managed.
Regarding the availability of facilities based on people’s needs, he said: In this case, if we want to make a comparison between the blue and red oceans, we will realize that in Iran, the blue ocean sector, which is the same issue of credit, has received less attention and we have just started. Talks that have been raised as credit are actually a type of loan and we have just started providing credit.
Hamed Qanadpour further said: In Iran, according to the economic conditions, we have about 9 tenths of the society, whose income and expenses break even in the best case. In this case, we are on the side of a social phenomenon that people become more indebted with the provision of landtech services.
In this case, it should be said that when we talk about the blue ocean in this service, by providing credit to deciles 1 to 9 and especially deciles 5 to 9, we will not face these people becoming more indebted if this credit is spent in their livelihood. However, according to the inflation conditions, in any case, providing this credit can benefit everyone. Unlike most businesses in the landtech sector, where the credit they provide is spent on digital goods or home appliances, we at Tara are focused on providing credit for people’s livelihoods and lives.
Accreditation and modification of lifestyle
The CEO of Tara said about the difference of this method, which does not lead to people becoming more indebted: In this way of providing credit, users face their bill after spending, and unlike other methods, presenting the bill can make the right choice by affecting people’s lifestyles. In the manner of the cost lead.
Regarding the challenges with the central bank in the way of providing Tara services, Qanadpour believes: We give two-month zero percent credit without fees, and to generate income, this income is received from the acceptors in the form of fees. We also seek to create value by working on the supply chain. For this reason, interest is not received in this income generation model, so we have not had any challenges with the central bank.
Qanadpour said about how to provide liquidity from businesses instead of banks in Tara: One of the reasons that made us launch Tara in Golrang Complex is the high cost of money. For this reason, it is possible to buy durable goods at this price, but it is not possible to buy goods related to livelihood. For this reason, this business model should be implemented using supply chains, and according to this issue, saffron was a suitable platform for Tara. I believe that the banking network is not able to provide credit with this money rate, and landtechs can fill this gap.
Credit increase based on validation
The CEO of Tara, regarding increasing credit based on validation, believes: We are facing the issue that the culture of trust in society is always decreasing. In Tara’s business model, first, along with initial validation, basic credit is considered based on building trust for the future. In this way, credit will increase over time and has reached 5 million Tomans. Regarding defaults, we can say that there is still no repayment culture. For example, after receiving a loan, the first few installments are usually forgotten, and we face the same issue at BNPL (Buy Now, Pay Later). Because repayment in this method is done in only one or two steps.
Qanadpour also said about the impact of inflation on livelihoods and the gap created by it, in addition to the increase in the need to receive credit: “Unfortunately, it must be said that inflation is in favor of credit.” One of the points where people feel credit helps them. In such a way that they pay the expenses related to livelihood first and then make repayments without getting involved with the price increase.
So it can be said that with the increase in inflationary conditions, Iqbal increases credit. Regarding the increase in demand, it should be said that we do not take help from financial sources in Tara’s business model and we manage the situation by using methods such as delay in settlement.
The CEO of Tara explained how to work with adopters as follows: In this area, like other multi-dimensional platforms, we have the chicken and the egg issue. But we have reached the point where the adopters get a favorable result in the short term and trust is built.
Regarding cooperation with other similar platforms, he said: We welcome cooperation with other platforms, and currently, in cooperation with Tapsi, the Tapsi credit service is provided by Tara. We have also had activities in various fields. As a platform business, Tara can help businesses in the credit space, and we are seriously considering this model at Tara.
What is the share of BNPL and Landtech services in micro-bank facilities, he said: These services are new. The cake of landtechs in Iran is still very small. In this context, the numbers announced by the activists, many of them do not seem real. In this case, we have to help the cake of these activities become bigger because the market is very big.
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