Started in 2014 by Sandeep Aggarwal, who also founded e-commerce marketplace ShopClues, Droom on Thursday (April 13) launched Droom Credit, a marketplace to get loans to buy used automobiles, a first of its kind in India. 

The e-commerce company is aiming at a gross merchandise value (GMV) of Rs 7,500 crore and net revenues worth Rs 120 crore by FY 2017-18, Aggarwal told BW Businessworld in an interview. 

Edited excerpts:

Please tell us your objective behind foraying into used vehicle financing business through the online route?
Getting into auto loan for used vehicles in India has been full of pain points like high rejection rates, lots of paperwork and unaffordable credit terms. Therefore, we wanted to fill the white space by providing auto loan in a seamless manner which will be affordable, efficient and paperless. As we have multiple lenders competing for the same business, the borrowers can get credit terms that are not easy to find or possible in a tradition system.

Will it be fair to say that PV segment will account for the majority of the pie?
That’s right. Transaction-wise, 65 per cent is derived from the two-wheeler segment, 30 per cent is from PVs and 5 per cent from services like roadside assistance, etc. But in terms of GMV, 78 per cent is derived from PV, 20 per cent from two-wheelers and only 2 per cent is from CVs.

Tell us about your presence in online automobile retail industry?
We have a 55 per cent marketshare in the country’s online automobile market whether it is run by online classifieds like Quikr, OLX, etc or by discovery platform like Cardekho, Carwale, etc or by transaction platform like Droom. Out of the US$ 150 billion automobile market, roughly US$ 600-700 million is derived from the online space. We are the 5th largest player in the country’s e-commerce market.

Could you share with us about your company’s GMV and the revenues earned from it?
Our current annual run rate for GMV is Rs. 2,500 crore and our current annualized run rate for the number of transactions was Rs. 250,000 and out of this our net revenues come to about Rs. 45 crore. By the end of this financial year, we will be clocking Rs. 120 crore which will be garnered from our annual GMV of Rs. 7,500 crore. We will be doubling our current GMV to Rs. 5,000 crore by the end of this financial year.

What are the current challenges that you are facing in your business?
Since we are a technology, data science and innovation type company implementing products and solutions fast. So if we don’t implement fast, someone else will do and we will be left behind. So speed-to-market is our biggest challenge followed by getting loads of data scientists, engineers and product managers. Apart from this, making sure sellers who are not so digital-savvy adapt to your technology faster is also our challenge.

Finally, what is your vision for the company?
Unlike Europe, the US and Japan, India is a low-trust market where people inherently don’t trust each other. While dealing with a used car or two-wheeler, there are four pain points. These are: who is the seller and can I trust him? How is the condition of the vehicle? Aiming I paying the right price? And are the documents genuine? Our vision was and is to increase trust, bring transparency as well as standardization of pricing so no one has to deal with this four pain points. We build a marketplace which can work on this along with some ecosystem services tools. Our vision is taking these ecosystem services tools as a service to the entire part of the country cutting horizontally rather than just limiting it to Droom.