Online transactional automotive marketplace Carro has closed a $12 million investment whose proceeds will go towards its car loan financing platform, Genie Financial Services, a hire-purchase provider offering rapid automotive loan approvals and artificial intelligence (AI) based chatbots to customers.
This car financing scheme is being offered through Genie Financial Services, a wholly-owned subsidiary of Carro helmed by Helen Neo.
According to media reports, proceeds from the investment will be used to fund Genie, in addition to being split between its markets in Southeast Asia – Singapore, Indonesia and Thailand.
Carro reports that via algorithmic mechanisms which underly credit underwriting and customer service, Genie can accurately reprice and compute a loan to suit the risk profile of the individual and offers an artificial intelligence (AI) based chatbot service.
Genie Finance is available on iOS and Android platforms and offers consumers 24/7 support for retrieving information about auto financing or re- financing packages provided by Genie and partner banks.
According to a media release, the genesis of Genie stemmed from a recognition that accessing automotive financing could be complicated, resulting in Carro establishing a team to develop an integrated solution for customers that became Genie. Genie doesn’t just redirect consumers to the banks for loans – the firm underwrites the loan themselves. This control of the user experience allows the firm to better innovate and provide for a speedy loan approval process.
When asked about partner banks, Aaron Tan, CEO and founder of Carro, told this portal: “We partner with most of the large banks in Singapore and Indonesia.” However, he declined to specifically name the banks.
In an official statement, Tan explained: “We want to do our part in making auto financing more efficient and accessible. Unlike other major automotive markets such as China and the United States, a larger proportion of consumers tend to take financing in Southeast Asia”.
This difference renders the automotive financing market in Southeast Asia more attractive than larger counterparts. Carro said that it had facilitated transactions in excess of $50 million worth of cars in 2016.
Asked about its growth strategy and entry into the financial space, Tan told DEALSTREETASIA in an email exchange: “Currently we are laser-focused in cars, with no plans on entering other financing segments. We have achieved over $100M worth of transactions to date and plan on transacting over $500M worth of cars before the end of the year.”
When asked about possible plans for entering the insurance space, Tan added: “In the insurance space, we would prefer to partner in the foreseeable future.”
Tan further said that M&A was a possibility for its growth strategy, being a “path to grow and bring aggressive, talented people on board the team” and that it had not immediate plans to enter developed economies like Australia and Japan, though it was “…definitely doing more work in other developed markets and not just in the developing markets.”
When asked about Carro’s exit strategy, Tan remarked: “I think we look as Carro as a solid ecosystem business. While we can’t rule out an IPO or an M&A. We prefer to continue executing and building a really solid company and worry about a potential buyout when it comes.”
Commenting on current inefficiencies he perceived in the venture ecosystem, given his background with Singtel Innov8, he said: “I think our ecosystem lacks good solid engineers (who are interested in core engineering stuff) and folks who have been there done that. I think for an ecosystem to be vibrant we need a generation of change.”
“A generation of entrepreneurs who have successfully exited and come back to contribute and be part of the ecosystem again would be required for us to improve our existing inefficiencies further. I also think there is a serious lack of capital in between Series A and B stages which could be further looked into,” he added.