{"id":2039,"date":"2023-04-17T10:20:06","date_gmt":"2023-04-17T10:20:06","guid":{"rendered":"https:\/\/trica.co\/capital\/blog\/?p=2039"},"modified":"2023-04-17T10:23:05","modified_gmt":"2023-04-17T10:23:05","slug":"to-ai-or-not-to-ai","status":"publish","type":"post","link":"https:\/\/trica.co\/capital\/blog\/to-ai-or-not-to-ai\/","title":{"rendered":"To AI or not to AI?"},"content":{"rendered":"

A few years ago, Manuraj Jain got a startup idea from his driver. He used to borrow money from Manuraj frequently to deposit in a small rotating scheme (or \u201cchitty\u201d and \u201ccommittee\u201d as it is colloquially known), a savings system popular among the low-income population of drivers, maids, street vendors etc.<\/span><\/p>\n

In the offline world, \u2018group owners\u2019 of such funds get a group of people together, collect a specific amount of money from all of them, conduct an auction, and disperse the money among them. Coming from a tech background, Manuraj was curious to bring this system online.\u00a0<\/span><\/p>\n

Manuraj\u2019s initial idea was to make an app for the group owners to help manage the groups. But the group owners did not want to use the app because they use cash and not digital money. After talking to around 2000 people who downloaded the app (over a year), Manuraj understood that what they needed was reliable people to make up their groups. \u201cThey asked me to help them meet such people. But that would mean that I have to take credit risk. After some initial reluctance, I decided to do it,\u201d he says.\u00a0<\/span><\/p>\n

Thus, after trial and error, he launched The Money Club, world\u2019s first AI-backed online group savings platform, in 2016.<\/span><\/p>\n

The Money Club uses Artificial Intelligence for verifying its users who do not even have a bank statement, based on the data from the app they download, thus building a network of trusted individuals. Every new user is verified against the \u2018power users\u2019 with an AI code which is trained to reflect the latest status of the power user on the platform. The incoming leads are taken forward only if they match the power users by 40%.\u00a0\u00a0<\/span><\/p>\n

\u201cAI has helped us keep default rates below 1.4%. Even the banking and chit fund industries have 3% or more,\u201d says Manuraj.<\/span><\/p><\/blockquote>\n

To weed out unscrupulous users from the system, the AI platform collects transaction data – 20x more than any fintech company, Manuraj says – and qualifies users as a good\/bad user based on their transaction patterns. If a user is delaying their transactions, they are not allowed to the next level. (Every user group has 10 members each, and their corpus starts from Rs.600\/month and goes up to Rs.40,000\/month. Users are \u2018promoted\u2019 to higher-corpus groups based on the discipline of their transactions.)\u00a0\u00a0<\/span><\/p>\n

Just like we didn\u2019t see AI coming to take over something as traditional as chit funds, we are surprised, and excited, at the rise of <\/span>Rephrase.ai, which converts text to video and has found numerous applications across sectors. We recently had a <\/span>chat <\/span>with its Co-founder and CEO Ashray Malhotra<\/a> on how they worked with Shah Rukh Khan and created history for Indian advertising:\u00a0<\/span><\/p>\n