LenDenClub: Bhavin Patel & Dipesh Karki on Disrupting the Banking Monopoly with India's Largest P2P Platform
In the traditional Indian financial system, the "Raw Material" of the lending industry—money—has always been monopolized by the banking system. For decades, Non-Banking Financial Companies (NBFCs) and micro-lenders have been entirely dependent on bank capital, making them vulnerable to shifting interest rates and regulatory swings. Bhavin Patel and Dipesh Karki, Founders of LenDenClub, saw this systemic dependency as a roadblock to true financial inclusion. Their solution? Building a decentralized, 100% digital Peer-to-Peer (P2P) exchange that connects individual investors directly with creditworthy borrowers. Today, LenDenClub is India’s leading P2P lending platform, having disbursed over ₹16,000 crore while operating at an industry-low 3% cost structure.
On the ELI Podcast, Bhavin and Dipesh share their journey from a chance meeting on a football WhatsApp group to building a regulated powerhouse that competes with traditional banks. They discuss the "Securitization" spark that started it all, the technical hurdles of digitizing legal mandates, and why they believe P2P lending is the future of retail banking in India.
The P2P Exchange Advantage
Unlike traditional banks that operate with an 8–10% cost structure, LenDenClub runs at just **3% operational cost**. This efficiency is achieved by being 100% digital—eliminating physical branches and armies of collection agents—and passing the benefits of higher returns to investors and lower rates to borrowers.
The Securitization Spark
Bhavin’s journey in the credit markets began in 2008, where he was introduced to the complex world of "Securitization"—the process of packaging debt into tradeable assets. He realized that the entire Indian lending ecosystem was "starving for capital" because it was tethered to the banking system.
"If the raw material (money) isn't available, you can't make the finished goods (loans)," Bhavin explains. "We wanted to reduce this dependency by allowing individual savers to act like the banking capital themselves. P2P was the natural evolution of this idea."
Finding the "Tech Mojo": A WhatsApp Connection
Building a fintech powerhouse required a perfect blend of finance and technology. Bhavin, a finance veteran from **IIM Indore**, spent months looking for a co-founder who wouldn't just "fight over technology" but would share the long-term vision.
After several failed attempts to find a partner in his professional network, he sent a message to a local football group. **Dipesh Karki**, a technical expert who was transitioning from his own previous startup, responded. After six months of testing their "mojo," the duo officially co-founded LenDenClub in 2015.
The LenDenClub Digital Stack
- 5-Minute Onboarding: A completely paperless loan application process for borrowers.
- Real-Time Underwriting: AI and ML-driven risk analysis using modernized stacks like Django, Python, and React.
- Instant Mandates: Digitizing the tedious "NACH" agreement process, moving from a week-long manual cycle to a one-click digital signature.
- Transparency Feed: Providing investors with a real-time view of where their money is going and how it is being collected.
Cracking the "Chicken and Egg" Problem
Like any marketplace, LenDenClub faced the challenge of supply and demand. "We started with a prototype that was 80% physical and 20% digital," Dipesh recalls. They personally onboarded the first five "believer" brands and individual investors.
"The first customer was my wife's father," Bhavin laughs. "In the first month, we had 20–25 people. By the second month, we disbursed our first successful loan of ₹50,000. Once you have that first egg and first chicken out, it's about how big a farm you can build."
The "Unsecured" Niche: Serving the Salaried Segment
LenDenClub has remained laser-focused on its core niche: **unsecured personal loans for the salaried segment**. While they've added small-ticket merchant loans for Kirana shops, their primary goal remains building a sustainable, unit-positive business.
Impact at Scale (FY25)
- Revenue: ₹236 Crore (28% YoY growth).
- Profitability: ₹34 Crore net profit, marking a 340% increase in PAT.
- Disbursements: Over ₹16,000 Crore since inception.
- User Base: Trusted by 3 Crore registered users and 1.5 Lakh active parents/investors.
Navigating Regulatory Turbulence
Being a regulated **NBFC-P2P** entity means living with constant change. In August 2024, the RBI introduced stricter guidelines for the sector, including a ban on assured returns and mandatory escrow fund transfers. Despite a ₹1.995 crore penalty for historic non-compliances, Bhavin and Dipesh view regulation as a vital shield for consumers.
"Entrepreneurship is about identifying gaps and focusing on solving them," Bhavin notes. "We revamped our entire platform to align with the new RBI framework because we believe this is the only way to build a sustainable, long-term legacy."
Advice for Future Founders
- Focus on the Root Cause: Hacks only last for a month or two. To build for the long term, you must solve the fundamental problem.
- Calculated Risk: Coming from middle-class backgrounds, the founders emphasize building a dream while keeping food on the table.
- Reinvent Yourself: Never stop learning. P2P is a new industry, and you must lead its definition through constant innovation.
The Vision: The Future of Indian Banking
For Bhavin Patel and Dipesh Karki, entrepreneurship is the **Joy of Creation**. They view their first 30 employees not as staff, but as investors who contribute the most valuable currency: the time of their life. As they continue to expand from salaried personal loans to diverse asset classes, their mission remains unchanged: to bring financial inclusion to every Indian through a transparent, efficient, and digital-first credit ecosystem.