The government of India has taken some major steps to support the growth of the EV industry, including financial incentives through the FAME-II scheme, promoting the benefits of EVs by talking about it and creating awareness at national level, and reducing GST on EV sales to 5%, shares Sameer Aggarwal, Founder & Chief Executive Officer, Revfin, in an exclusive interaction with Srajan Agarwal of Elets News Network (ENN).
How does Revfin plan to stay ahead in the rapidly evolving EV financing sector? And what are the future plans or goals for Revfin in terms of growth and expansion?
Revfin is using innovative technology to provide a user-friendly experience to customers who have no or low credit scores in tier 2 or 3 towns. We are also building strategic partnerships and constantly innovating our products and services to stay ahead in the rapidly evolving EV financing sector. In the next five years, Revfin aims to finance 2 million EVs, expand to 25 states from the current 16 states, and capture more than 20 per cent market share in 10 states from 4 states at present.
Can you share your thoughts on the challenges faced by your organisation in promoting EV adoption through financing?
Few major challenges, which were faced by Revfin:
a. The market segment lacks product standards, has unpredictable sales, and volatile policies, which makes it unstructured
b. The distribution network is fragmented, with some areas being inaccessible to lenders.
c. There is no established secondary market for second-hand sales.
d. 85% of potential customers are credit unworthy, with limited education, no or low credit history, and are new to credit.
Thus, these were some significant hurdles, which were faced by Revfin while entering the EV financing market segment
How has the government of India supported the growth of the EV industry, and what impact have these policies had on the availability of financing options for EV buyers?
The government of India has taken some major steps to support the growth of the EV industry, including financial incentives through the FAME-II scheme, promoting the benefits of EVs by talking about it and creating awareness at national level, and reducing GST on EV sales to 5 per cent. These policies have boosted the demand for EVs and had led to a more sustainable mode of transportation in India.
How are technological advancements, such as the development of new battery technologies, impacting the financing landscape for EVs in India, and what new opportunities and challenges does this present for financial institutions?
Technological advancements, such as the development of new battery technologies, are having a crucial impact on the financing landscape for EVs in India. As better vehicles and charging infrastructure are becoming more prevalent, the fundamental issues surrounding EV adoption are gradually declining.
However, with the emergence of new technologies, companies are facing challenges in determining which technology to back and invest in for the long term. There is uncertainty about which technology will be sustainable and which will become obsolete. This presents new opportunities and challenges for financial institutions to invest in the right technology and offer suitable financing options to buyers. To remain competitive and relevant, financial institutions must adapt to these changes and develop innovative financing solutions that align with the evolving technology landscape.