Description of Innovation

Traditional bank loans in India are only accessible to those who can provide periodic salary payments or other assets as collateral. This excludes most Indians, especially the poor and informally employed. If they are unable to borrow from family, they either borrow from moneylenders, often at interest rates of 60% or more, or go without care until health conditions become an emergency. This leads to catastrophic healthcare spending, which drives 30 million Indian citizens into poverty each year.

Using a new model for measuring credit worthiness and risk, Arogya Finance provides medical loans to the poor and informally employed population. Lending decisions can be made within three hours, rather than the seven to ten day wait of most traditional banks. This speed is critical in health emergencies. If approved, the Arogya pays the hospital or doctor directly and treatment can begin immediately.

Launched in 2011, Arogya Finance has partnered with 50 hospitals and healthcare service providers across India and processed 320 loans. The default rate is 2%. They plan to expand to provide 30,000 loans in the next three years. 

Providing Value to the Patient, Community, and Health System