How One Of India's Oldest Fintech Players Is Aiming To Capitalize The MSME Market
The MSME market in India mainly resides among merchants in Tier-II and Tier-III cities
In 2012, when only a handful of fintech players existed in India, most of whom were experimenting with digital consumer spending, the founders of Instamojo decided to tread on a different path. They aimed to become the digital point of sale (POS)/ transaction medium for offline MSME players that were not being looked as potential customers by most fintech players.
“We did not want to keep any minimum requirements. Anyone can avail our service, be it a single self-employed person or a business run by just 5 people and has no minimal transactional requirements either,” said Sampad Swain, the company’s co-founder and CEO.
The merchant focused payment collecting and integrated e-commerce platform, which was initially focused on generating single payment links for merchants, in a span of five years has been able to amass over 3,00,000 MSMEs in their kitty. Interestingly, unlike other merchant payment platforms, most of Instamojo’s customer base comes from non-metro terrains.
“The MSME market in India resides among merchants in Tier-II, Tier-III cities and so on. More than 65% of our customer base is from these areas, reflecting the rapid pace at which digitization has picked up in financial transactions,” said Swain.
Competitive Fintech Market
While Instamojo may have been one of the first fintech companies in India along with the likes of Paytm, the pace at which the fintech sector has grown in India, has put the company under a competitive lens. While the company still feels their target users are not on the radar of other merchant payment gateway companies, they want to step up in terms of the services they provide.
“We want to evolve from letting our customers not just accept payments but also meet their other business needs like logistics, lending, compliance and more, which we are in the processing of developing as Value Added Services,” said Swain.
And despite the surge in fintech companies, Swain feels every player has a wide area to cover, and there is enough space in the market for people to co-exist and grow .
“It’s a huge market we are talking about and only a fraction of it has been tapped. Plus I don’t believe fintech concepts of lending, payment acceptance, and transactions can give rise to a monopolized market where only one player takes the chunk of the pie,” he added.
Securing Customer Data
As more and more security breaches are being reported by financial companies world over, the spotlight is once again on Indian players, especially in the fintech domain who operate 95% of their business digitally.
“Nobody is secure at this point and anything and everything can be hacked. But we as a company take the threat very seriously and have placed the necessary protocols in place to deal with these threats,” said Swain.
The payment site is equipped with a standard PCI DSS level 1 certification, and their servers are encrypted with bank grade security encryption. Additionally a security audit for all card payments is done annually.
She was generating stories out of Bengaluru for Entrepreneur India. She has worked with leading national and international business publications, including Newsweek, Business Standard, and CNBC in the past.