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Three Wheels United is Taking an Ecosystem Approach to Enabling Drivers to Purchase an Electric Vehicle

Three Wheels United use innovative structured finance and credit enhancers specifically designed for mobility assets, to cover a loan to cover up to 100% of the vehicle cost at a low-interest rate

Three Wheels United (TWU) is combining tailored financing solutions with innovative loan management and asset management technology to offer a competitive loan, removing barriers for uptake, while de-risking their lending. TWU has developed data-driven technology that combines loan management and asset management, complimenting their community-driven model, that allows them to keep operations costs and default rates low while improving driver income.

Three Wheels United is based in Bangalore and was founded in 2017 but is a continuation of work started in 2009. They are a founding team of four: Cedrick Tandong, Kevin Wervenbos, Rosemary Pierce-Messick, Apurv Mehra.

Three Wheels United is a social enterprise that offers holistic financing solutions for auto drivers to own a light electric vehicle, such as an electric auto rickshaw. The financing that is available to light vehicle drivers, such as the auto-rickshaw drivers, has high down payments and interest rates, making receiving a loan not feasible for many drivers. Electric auto-rickshaws have a lower total cost of ownership and are more profitable than a fuel operated one, but have an even higher upfront cost, making them even more difficult to access.

“This idea has matured and developed over time as a result of projects conducted over the past decade, all designed to help the auto-rickshaw drivers, and to enable a shift to more sustainable vehicles. We have been part of a program funded by the European Commission, designed to enable a shift to more sustainable intermediate public transportation. During this time Three Wheels United identified the key challenges faced by the auto-rickshaw drivers and was able to develop their solution that works from the bottom-up to help drivers own an electric vehicle, in doing so improving drivers' income and contributing to cleaner air.” says Cedrick Tandong, CEO of Three Wheels United.

TWU has a strong community-driven model along with robust processes enhanced by innovative technology. They are able to offer a more competitive loan due to their tailored use of financial instruments.

“There are 12 million auto-rickshaws in India with over 500,000 vehicles sold each year, and 2-wheeler sales over the past two years being 40 times larger than this. We plan to continue to finance electric auto-rickshaws and move into the electric 2-wheeler space. To date, we have offered over 30,000 drivers various products and services and financed over 2500 autorickshaws resulting in 28,000 tonnes of CO2 emissions, and the generation of an extra $90 Million in income for the drivers. We plan to finance 10,000 EVs in the next one year and 100,000 in the next four. This will generate over $6 Billion of extra income for the drivers and reduce pollution by 6.5 Million tonnes.” adds Cedrick Tandong, CEO of Three Wheels United.

Their model and processes have been developed and perfected over a decade working with the auto-rickshaw market, and their technology was developed in partnership with Microsoft Research. And they have a deep understanding of the financing needs of this market and have developed tailored financing solutions based on the residual value of the vehicles and their batteries, allowing them to offer an effective and affordable loan.

Current financiers do not have all the aspects needed to finance electric light vehicles in India. Many have expensive loans or restrictive prerequisites. Micro-finance institutions who have the community-driven model are not able to lend to these clients due to regulatory restrictions. NBFCs often lack the deep market understanding to build a community-driven model, and the necessary processes to go with it. Three Wheels United's technology has enabled them to outperform on portfolio performance while still maintaining low operating costs. Three Wheels United was seeded with the help and support of a program funded by the European Commission.

“We have raised $1Million equity from various investors including South British Capital, Techstars, and angel investors. We are also receiving support from Microsoft. Three Wheels United's model is that of a financier, earning a spread on loans outstanding. From a driver who received a loan through Three Wheels United and now owns a vehicle: I had a dream to drive an auto, but didn't have the money to own one and worked as a garment worker. Now I'm living in good conditions, I can pay my children's school fees, and I don't have money issues anymore. I'll never forget Three Wheels United." says Cedrick Tandong, CEO of Three Wheels United.

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