AffordPlan, a healthcare-focused fintech company, announced it has raised $10 million in Series B funding. The round was led by Lok Capital and included, as a new investor, Omidyar Network, alongside existing investors Prime Venture Partners and Kalaari Capital. AffordPlan has partnered with more than 300 hospitals in the country to make non-emergency procedures affordable and has already reached more than 100,000 patients. In the next 12-18 months, the startup will focus on building a full stack of financial services products for healthcare and deepening its corresponding distribution and supply chain capabilities.
With its savings-led product, AffordPlan offers a unique financial alternative that empowers hospitals and diagnostic centers to improve access and affordability of medical services for its patients. The Fintech startup allows for planned savings that are ideal for non-emergency medical and expensive procedures such as pregnancy, eye care, dental, plastic surgeries, orthopedic, bariatric, and more. It enables hospitals to provide a tailored solution for patients to plan, save, and pay for their upcoming medical procedures. AffordPlan provides the hospitals with the visibility of future cash flows and enables them to deliver the prescribed treatment without any interruptions due to cash-flow issues.
The current system of healthcare financing is characterized by high out-of-pocket payments. Reports suggest that Indian households are increasingly relying on their own income and using their savings to finance healthcare expenses. This holds true for both rural and urban households, who together contribute about 62 percent of the total healthcare costs through out-of-pocket payments at the time of illness. This creates financial barriers to access healthcare services and many of those who access such services face financial catastrophe and impoverishment afterward. It is estimated that over 7 percent of the population slips below the poverty line due to health expenditures, while 27 percent of hospitalized patients have had to sell their assets or borrow to finance their healthcare expenses. The data indicates that health payments pushes 60 million people below the poverty line, every year. On the other hand, the depth of coverage of by insurance schemes (both government and private) is very low and often only covers hospitalization expenses.
As a solution to address this acute problem, AffordPlan is working towards reducing the burden of out-of-pocket expenses for patients and is making healthcare more accessible and affordable. It allows consumers to decide how much to save on a daily, weekly, or monthly basis – as per their chosen plan – and then make regular payments at their convenience. In addition to having an easy way to save, consumers also receive discounts on medical bills and diagnostic services when they use AffordPlan services, bringing the overall treatment costs down by as much as 15-20 percent. The CloudNine Group, Strand Life Sciences, and Millennium Cancer Centers are among a growing list of institutions that work with AffordPlan.
The new funds will be used to meet the growing demand for its unique savings-based finance platform and to advance the countrywide adoption of AffordPlan in various hospitals. The company is also planning to launch new savings, lending and insurance products to cover medical & healthcare expenses. The Delhi-based company is expanding rapidly and is looking to hire more than 200 employees across India by the end of 2018.
Tejbir Singh, CEO & Cofounder, AffordPlan commented, “We are humbled by the support we have received and are excited about the next phase of the company. The Indian healthcare sector is evolving to a state where patients will have multiple options for accessing healthcare from public & private insurance schemes, and other financial services initiatives. We have positioned AffordPlan at the intersection of finance, healthcare and technology to bring financial innovation to healthcare. We are well on our way to create the largest distribution network for financial services in healthcare in India.”
Venky Natarajan, Cofounder and Partner, Lok Capital stated, “For the longest period, we have been looking for suitable financial products in the healthcare spectrum to mitigate the risks of patients and their families getting trapped into the vicious cycle of debt trap rising out of unmanageable healthcare expenses. We believe that AffordPlan will help solve this problem through their range of products over the next few years. We are excited to partner with Tejbir, Hemal and the rest of the AffordPlan team.”
Shripati Acharya, Managing Partner, Prime Venture Partners commented, “There is a critical need to develop financial services to make healthcare affordable. Through its pioneering goal-based savings platform, AffordPlan aims to transform the lives of millions of Indians in the middle income and lower middle-income groups who are struggling to pay for planned health care procedures. We are privileged to be associated with this stellar team in their journey and be part of their vision to reinvent healthcare finance in India, and as a result, dramatically increase access to healthcare”
Vani Kola, Managing Director, Kalaari Capital says, “In the absence of widespread adoption of health insurance by India’s Next Billion consumers, there is an acute and unmet need for affordable and quality healthcare. AffordPlan’s innovative savings product makes quality healthcare more affordable to everyday Indians. We are heartened by the progress made by AffordPlan’s team and are excited to be part of their journey as they scale and expand pan-India.”