Analysis Featured

Online ID Verification in Russia

ID Finance

With a GDP of almost $1.4 Trillion, Russia is one of the biggest markets in the world. But due to geopolitical tensions and subsequent economic crisis, it has seen a lot of volatility in its ecosystem, which is not conducive for businesses and start-ups. Even the alternative lending industry, which has blossomed all across the globe, has yet to find a major foothold in Russia and CIS countries. Hence, there is a huge undeveloped and untapped market, and to take advantage, Boris Batine and Alexander Dunaev launched ID Finance in Russia.

ID Finance History

ID Finance was founded in 2012 and in a very few years was able to carve its own niche in the financial lending segment. It has been one of the leading players in the fintech industry with core expertise in data science, non-FICO scoring, and digital finance. As a lot of fragmented data is available in developing markets, it has hired a team of data scientists to assess risk factor and detect fraud. Being able to bring transparency to markets and data presented is the company’s USP.

Further, on the knowledge drawn, three smart data lending flagship products (MoneyMan, Ammopay, and Solva) were developed for emerging markets. The company started in CIS and then expanded to Spain and Poland. It has recently rolled out in Latin America.

Expansion and Regulatory Issues

It hasn’t been smooth sailing in new markets; the company has to fend off a lot of bureaucracy and had to deal with convoluted regulatory layers to find its feet. For instance, in Brazil, it had to partner with a bank to launch in the country. Without that collaboration, it would have taken two to three years to just start.

Such markets are highly complex with a lot of bureaucracy and complicated regulatory regime. They’ve been mostly overlooked by both traditional and fintech lenders.

ID Finance has succeeded in such non-credit-mature economies and this has enabled the company to compete with established players such as Enova International, the US-based NYSE-listed fintech company.

ID Finance chose to expand in Latin America over Asia as South America has a common language and a similar legal regime whereas every Asian country is a different market in its own right.

ID Finance’s Lending Stats

ID Finance provides unsecured short-term and long-term loans, and point-of-sale financing. It is a balance sheet lender that has partnered with banks, funds, and investors for its funding requirements. Since inception, ID Finance has originated around 720,000 personal loans worth $200 million. About half of its growth was observed in 2016 as loans worth $90 million were issued as compared to $32 million in 2015. The company hopes to grow its books by two and half times this year.

The average APR is 10% per month. The company’s cost of funding is around 10%-11% per annum. It is focusing on bringing down the APR so that clients could have access to a cheaper long-term source of credit. Even the clients with bad credit history and the ones who were earlier rejected by banks can enter the formal credit channels by obtaining their initial loans from ID Finance.

Differentiator and Innovation

ID Finance is continually concentrating on R&D to bring innovative risk assessment models and has further stepped up in developing innovative solutions for both web and mobile platforms. This is what differentiates the emerging market player from the developed market players.

Today, the world is producing vast amounts of data, and this can be leveraged to help generate access to the financial services needed by the people.

In Russia, ID Finance joined hands with Experian, a leading global information service company, and developed online ID verification, which is now widely used all over the world. Continuing the same trend in Europe, it has collaborated with Instanton, a Swedish company, which has developed an ID check to cross check names and data. After tasting success in Russia and Europe, it is planning to take these products to Latin America and develop similar services that could possibly reduce the degree of fraud risk on its loan portfolios. Its mission is not only to launch new products in the market but to shape the market, as well.

Staggering Numbers

In a short period of time, ID finance has been able to capture a large chunk of borrowers; it has around 2.8 million registered clients. On top of that, in 2016, the company was able to generate $68 million in revenue with a 222% growth rate. Being profitable is a hallmark of a mature company, and ID Finance raked in around $8 million dollars in profit last year.
ID Finance

Another added advantage of being profitable is it is easy to attract investors. Hence, ID Finance has not found any difficulty raising funds. The company has managed to raise $59 million since inception, and the latest round of funding ($50 million) will be used for expansion across Latin America.

Customer Acquisition

ID finance is among the top non-bank financial brands in CIS and undertakes huge investment in branding and creating overall awareness to bring the client acquisition cost down. Moreover, it becomes inexpensive to acquire brand-conscious customers, and they turn out to be the most loyal clients with the best repayment rates. ID Finance also uses diversified channels to acquire customers, such as digital media (Google, Facebook), affiliate marketing, or direct marketing.


Boris Batine, the co-founder and CEO, has extensive experience in the banking sector and, prior to ID finance, he worked with Royal Bank, Deutsche Bank, and Renaissance Capital. Alexander Dunaev, the co-founder and COO, worked with Deutsche Bank.


The company is only five years old and has embraced the concept that profitability is the only way to move forward. Starting from a country like Russia hampered its ability to raise investor funding, and this forced it to ensure that its unit economics are strong and can grow on their own. With the latest round of funding and a core lending infrastructure already built, ID Finance can replicate its success in multiple developing countries around the world.


Written by Heena Dhir.


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