Disruptions make way for success in the Indian Fintech market

Financial services have had huge number of disruptions in the past three years and the phase is yet to settle down. This phase of disruptions has been channelized by the rising number of technology companies and startup-vogue driven innovations. Lending and payments have introduced a new dimension to the Fintech market of India.

Indian Fintech Industry is reportedly set to reach a whopping size of $2.4 Bn by 2020. With more and more startups doing the rounds in the Fintech market bigger players seem to fall in the trend of making big investments. According to a recent study that calculated the phenomenal rise (in the period between 2014 to 2016) of the Indian startups in relation to the Fintech market here are a few important summations:

Paytm has reportedly been active in funding, a massive 38.5% of the total Fintech funding in 2014 – 2016. 37 (which is huge according to industry experts) market related subsector funding has taken place in the phase between 2014 – 2016. Highest monthly profit with $25.71Mn deals and funding activities taking place in August, 2016.
248 investors (completely new born) who have had prominent reach and presence in the Fintech market during this phase. A whopping figure – 76 Fintech deals have taken place in 2016, which is a huge rise from the November – December 2015 phase. A two-fold rise in the market size by 2020.

Numerous collaborations between large-sized companies and startups have been possible. Existing players have been forced to invest big money to expand their services and range of product offerings in the market.

With the true advent digital India BFSI sector has seen expansion. The Fintech market has set up new-age prospects for consumers and business houses. Collaborations and new product launches have set up competitions.

Inc42 has provided few financial reports that indicate the changing trend in the Indian Fintech funding:

Fintech has reportedly brought with itself $1.77 Bn  worth of business in India  in 2014. Several start-ups have become household names in India. There are various big ticket funding that are in the pipeline. Average Fintech funding ticket sizes have been estimated to stand at about $9.82 Mn in the phase between 2014  – 2015.

There are potential big ticket funding to come up in the near future. Mumbai has witnessed the birth and growth of major changes in the Indian financial environment. With start-ups such as InCred, Mswipe and Citrus Pay, Mumbai has seen a momentum in the Fintech marketplace.

With all the financial new waves, shocks, disruptions and storms taking place in the present times, Fintech has been enjoying its new found space, recognition and expansion. Demonetization in India has only been a fodder to the massive rise of Fintech. The future path seems a lot more promising than the previous ones. BFSI sector seems to enjoy the new found warmth and renewed vigour with its Fintech arm positioning itself zealously.

Visit us for more on BFSI industry news and latest updates: http://www.senrysa.com/blog/

 

Financial Inclusion has taken a significant role in the present times

Senrysa’s UBBP platform is a non-banking entity delivering comprehensive banking services to the un-banked Indian population. With a client base of 20 million and rising we are proud to support and commit ourselves to the consumers in the journey of diverse, branch-less, multi-channel inclusive banking services.

Visit us www.senrysa.com for a detailed know-how on our area of work and expertise.

Digitization – The only way to move forward

Digitization drive has reached an inflection point in banking parlance: it is no longer a mere option but an absolute must. The motive is not solely to pull in the huge unbanked customer base but also serve the existing market by providing them with easy access to carry out transactions smoothly and securely on their smartphones. This provides relief to the customers and helps them save their valuable time by carrying out transactions on their smartphones without the inconvenience of going to the bank for every little task.

Digitization has helped banks successfully leverage technology effectively and efficiently. This has massively minimized costs, without having to invest more in brick and mortar presence for garnering new customers into its database. Thus banks are able to achieve a dual objective and able to generate more revenue with the same infrastructure thus ensuring that their bottom line remains healthy.

In order to ensure that the word digitization is not overused and connoted with cost factor singularly, Indian banks do realize the fact that for achieving digitization, it doesn’t imply putting in massive investments in technology or any distinctive change in its operative module; rather what is required is leveraging the existing platforms and investing wisely on the basis of requirements.

Banks are adopting mobility based platform keeping the financial inclusion goal in mind and at the same time able to maintain pace with the growing trend of higher mobile penetration among the masses. This emerging trend definitely points towards mobile and cloud-based application mediums, which undoubtedly shall rule the roost in the years to come.

It is important to note that for availing cloud-based services: banks shall have to only consider investments related to only operational cost. However simultaneously, it also needs to build safeguards against data theft and ensure that security along with compliance is strictly taken care.

Introduction of Newer Products  

Technology in the banking sector has introduced new products viz Blockchain technology. A blockchain is one type of distributed ledger comprising of unchangeable digitally recorded data in packages called blocks. The ingenuity of this new concept helps in simplifying technology further by storing data block wise in a linear chain. Therefore each block containing data is cryptographically hashed which ensures that the data remains untampered and unchanged. One of the key innovation of blockchain technology is the crypto instrument which is poised to be a fundamental game changer in the history of banking world over. Cryptocurrency, an outcome of the crypto instrument shall be a new form of money which will pave the way for a new financial system. The role of banks in the day to day transaction shall be further  marginalized.

Messaging Bots is the other major invention by banks: using technology effectively to engage with customers. According to Hardeesh Kumar, Canara bank has plans to deploy such applications across various mobile apps and the bank’s website to facilitate customer’s related queries by engaging with them regarding information related to financial products.

Similarly, Ashutosh Kumar says Standard Chartered too is working on similar lines and if a corporate is registered with any one of the banks mobile apps-’Straight to banking platform’.In such a case, the customer can view a cash position of any company by simply speaking on their smartphones – show me the cash position of XYZ Company. The app would then respond by displaying the information of cash flow position on the screen of the customer.

The above emerging trend  points towards a fascinating digital journey wherein customers are bound to benefit from  technological advancement. Besides making it convenient, banking experience  shall be easy and secure. It could therefore  be said that the  banking domain  will not be the same again. Several pilots are undergoing trial runs by most of the banks and we believe it’s a matter of time before the entire BFSI industry undergoes major transformations in the years to come.

 

Banks opting for advanced technologies to become customer-centric business organizations

We are getting ahead with the fast changing banking dynamics. At Senrysa we build banking platforms that change archaic banking processes. We initiate global trends in our Fintech and other BFSI ventures. Visit us to get acquainted with banking technology consultation and support: http://www.senrysa.com/banking

5 Biggest Banking Trends in 2017

With too many disruptions like Brexit, US elections and India’s demonetization in 2016, banking sector has tried saving its grace from the very beginning of 2017. Fast-changing commerce models has left nations around the world to take note and allow their banks to involve and indulge in new patterns and add ‘hospitality’ in its financial services. Biggest banking trends in 2017 include Chatbots, advanced machine learning, Artificial Intelligence (AI), blockchain solutions and the Open API banks. With technological inclusions taking place exceedingly the banking sector anticipates more disruptions (a commotion of sorts is most likely to take place) in 2017. Leadership plans along with long-term visions need to be set for constructive banking sector (BFSI sector as a whole) goals.

Entry of Chatbots    

With established technologies making their foray into financial services, 2017 is being predicted as the year of ‘BOTS’. New voice commerce and robotic process automation are being considered as one of the biggest dominators in India, U.S, Singapore, Europe and the Middle East. Leading banks around the world are fast picking up IoT data and robo-advisors for more intricate banking experiences.

Chatbots are not yet considered cost effective, neither are they widely available now. But soon (as predicted by BFSI industry experts) it will be made appropriate for automation and reinvented customer experience. Chatbots combined with AI are bringing back personal tones in B2C dialogues.  Companies like Amazon, Apple and Google have experienced massive growth by including these two technologies for consumer adoption. Banking services performed via mobile apps are slower and less engaging than chatbot offerings as the latter brings in more private and better engaged communication environment with itself.

Banks can perform the following set of actions in a single chat with a customer:

  1. Get customer feedback.
  2. Assist onboarding.
  3. Help someone take important financial decisions.
  4. Upsell their products.
  5. Provide significant and time sensitive transaction-oriented information and alerts.
  6. Handle complaints.
  7. Listen to personal concerns.
  8. Carry out trading, buying and selling of shares.
  9. Offer customer loyalty points and related benefits (if any).

Chatbot has not yet turned into the face of banks but it can surely replace various manual and repetitive banking burdens. For bankers ‘conversational commerce’ is the most important thing to be considered. Chatbots can be utilized in providing specialized functions that include performance based on actions depending on information.

Advanced machine learning and Artificial Intelligence (AI)

In an era when technologies are converging to come up with bigger and better innovations, AI remains in the heart of it all. Whether it is Natural Language Programming (NLP) or Internet of Things (IoT) or data sciences & automation or Optical Character Recognition (OCR) – AI will be the connecting dot that will make structural changes in financial processes and operatives.

Several banks have carried out KYC and onboarding processes with the help of AI. Wealth Management industry is most likely to take up robo-advisor and algorithm-driven investment approaches.

High frequency trading requires faster result generation which is impossible for human financial advisors to carry forward with. A hybrid robo-advisor brings with itself faster engagement and better one-to-one communication. Complex financial management and banking processes are smoothly carried out by bots (based on AI engineering). Hybrid robo-advisors are able to give long term financial plans and help people take life-decisions on children’s education funds, etc based on their asset quantification power, which is much higher than human advisors.

Robo advisors might well be the solution to customer related problems such as loyalty and retention. With generation Y choosing faster economic transfers and processes, efficient technological banking adaptations are on their way. According to banking industry reports, every year $1 trillion is inherited by new generations. Individual net worth is also exceeding every year. $56 trillion is the global value of individuals’-net-worth.

By the time we reach 2020, USA will reportedly have millennials and teenagers acquiring 50% of all existing assets.

A report presented by PWC in 2015 suggested that wealth transfers and asset attrition rates will rise high in the coming years.

 

‘Blockchain’ Solutions will soon be an integral part of Mainstream Banking

Blockchain solutions will reportedly go mainstream soon. However 2017 will probably not be the year for this technology to go live. According to a report published by Greenwich Associates, the capital markets blockchain received a generous investment roughly amounting to $1 billion.

Gartner has also stated that ‘blockchain’ has reached the “…peak of inflated expectations…” Global search volume stood at an all-time high in June 2016.  It will see banks working together and leveraging blockchain accelerators to bring out pilot programs and proof of concepts.

Financial institutions that are technologically bent will come up with customer-focused financial processes in 2017. A major opening of opportunities will soon take place where technology and finance vendors will fast-track blockchain programs.

Blockchain will soon be an integral part of mainstream banking.

Open API Bank

The mobile app marketplace has been revolutionized all over again. BFSI (Banking Financial Services and Insurance) industry is gaining momentum, added vigour and agility with each passing day. Financial apps are being made day in and day out. Numerous organizations are entering the app marketplace. This makes it suitable for Open API banks to come into clear picture.

The very popular Open API programs are important places for latest fintech banking processes and business models to be introduced.

‘Unified Solutions’ seems to be the light of the day for everyone (working within BFSI industries). Open and digital banking empowers everyone. Fintech expert Ron Shevlin has come up with a term – ‘Platformification’ which according to him is all about supporting multi-channel, open and unified integration. The synergy between BFSI partners and channels accentuate process deliveries, service qualities and nature of transactions.

A rough industry estimate suggests major growth in API platforms. Broader capabilities in loyalty, financial management, marketing, customer communication management, analytics and payments are foreseen in the upcoming months. Major banks will soon include more digital banking API platforms in their processes.

2017 will be a year of hard core competition between banks. With chatbots the overall banking dynamics is all set to change. A commotion of accelerated banking and disruptive digital transformations will brighten up 2017, bringing it out from the mundane BFSI processes. These technological financial inclusions will reduce costs, drastically change levels of service and automate traditional banking processes. Dynamics of market leaders will also change due to the changing demands for better enabled financial services (demands brought about by rich teenage population, millennials and young wealth heirs).

Senrysa Technologies Private Limited has come up with Aadhaar enabled payment apps and provides financial solutions to millions in India’s RRB sector. There are numerous digital payment processes being planned and in our pipeline for future launch. The organization has been in line with the latest commerce models being included across the globe.

Q3 corporate earnings post demonetisation- Senrysa’s Perspective

If there is one news that India Inc. have been waiting with baited breadth – Report card for Q3 (2016-17) corporate results. This is because post demonetisation, life in India has not been the same before. Indians have faced severe cash crunch post demonetisation and are slowly grappling to come in terms with the same. However, they are moving slowly but surely towards a digital India.

Post demonetisation corporate earnings for Q3 have remained sluggish overall, bad for some and not so bad for others. If we were to take a synopsis of the entire industry, the worst affected has been the auto industry. It has been routinely observed all along that the trend for auto sales remains poor in December since most people anticipate low return on resale value of their vehicle and prefer to defer buying decision until January. This year in particular auto industry suffered a double whammy considering the above factor and also sales remained low because of scarcity of cash/withdrawal restrictions.

According to Kotak Institutional equities revenue and net profit for auto companies is likely to decline by 4 percent and 10 percent respectively. The scenario in two wheeler sales would have been worse as around sixty percent of sales in this segment takes place in cash but thanks to higher sales in first 40 days of Q3 have therefore salvaged the situation somewhat which otherwise  would have been very bad.

Industries like pharmaceuticals, IT, commodities and oil & gas have not faced any major brunt of demonetization largely due to their global customer base and also because their exposure to retail customers has been minimal.  Most market analysts also feel that Q3 results, especially earnings In December may not be all that bad for Nifty 50 and large companies too. Here again, according to Harish Krishnan, Vice-President — Fund Management Equity, Kotak Mutual Fund. “The probability of earnings declining by double digits in Q3 is very low. Forty-five out of 90 days have been good due to festive season. The first half was also good,” Therefore it could be safely argued that most companies in the Nifty100 will also see not much impact from demonetization.

 Overall the fallout of demonetization on third quarter earning shall be negated thanks largely due to Seventh Pay Commission payouts coupled with robust festival season. The above two has been a saver for sectors such as consumer goods and consumer durables which otherwise would have witnessed plummeting sales due to severe cash crunch. Therefore Santa’s gift as Seventh Pay Commission payouts marked with other festivities during this quarter have certainly been able to cushion things somewhat and saved the blushes for most manufacturers from the dismal performance.

We feel that companies dependent on urban areas for sustenance will be less impacted when compared to those operating predominantly in rural areas since the latter has less access to banking and limited use of plastic money compared to the former.

Accion finds India a hotbed of financial inclusions

Accion is reportedly all set to double its investment plans in India. Accion COO Esteban Altschul spoke about the immense possibilities in favour of India’s  financial inclusion and financial technology sectors. Fintech companies can hope for doubled investment figures amounting to $50 Million being promised by Accion. “Today, India is our most active country. We have a three-pronged strategy in the country,” said Accion chief operating officer (COO) Esteban A Altschul. He also added how his company has already been in talks with several other companies for possible investments and how it was important to note that “…India is the hotbed for financial inclusion worldwide”.

Accion will reportedly be planning to make investments in various segments related to Financial Inclusion such as insurance products, alternative credit scoring and risk management. Actively working in India for the last ten years, Accion has a strong knowledge on the possibilities of India financial market. It has already worked with IFMR Holdings, Saija Finance and Swadhaar Finserv (all BFSI companies in India).

With financial technology innovations being on an all-time high in India, Accion brings with itself operations in 30 nations across the globe. This calls for a toast  as India is currently positioned in its financial tornado. The massive market possibilities in India’s financial race comes from small, medium and large scale industry players. We Indians can rightly rejoice Altschul’s statement, “…or Accion, in terms of our current exposure and potential that we see, India is the most important country for us.”

With more than dozen ventures of about $8 million and few more in the pipeline Accion’s Indian commitments also include Shubham Housing Development Finance, NeoGrowth, CreditMantri, MeraDoctor and AYE Finance. Accion, one of the major international financial organizations, has invested in micro-finance, non-banking and fintech companies through its three-way financial vehicles such as Frontier Inclusion Fund, Gateway Fund and Venture Lab.

In the global scales, there are numerous financial innovations happening. Accion has clearly stated how nations like India, Kenya, Colombia, Nigeria, Peru, China and Mexico have given immense success to Accion’s operatives. On a high and seemingly happy note Esteban A Altschul added “…Those are the countries where you have the combination of more scale, more impact innovative entrepreneurs and more possibilities to make a change”.

When asked about the impact of demonetization on their business strategies, Altschul felt “We believe this is a short-term impact and the assumption is that it would gradually but relatively quickly get back to normal,” India’s financial possibilities and overall portfolio has not taken a hit as Altschul ended by saying, “The quality of the portfolio remains sound, at least for our partners”. It would not be before March, 2017 when the long term impact (if any) will be felt by Indians.

Our Innovative Mobility and enterprise Solutions

Mobile App Development for iOS and Android is all about smart and innovative thinking. We think ahead of time to deliver advanced app development serviced to our clients. You can reach us at: http://www.senrysa.com/contact

Mobility is the heart of all digital transformations in the modern day world. Our innovative and user-centric mobility solutions and services will help you to achieve business growth. Our mobility solutions include application development keeping in mind the following areas – Vertical focused, UX, User Engagement, Productivity and workflow, Personalization, information/content, ecommerce, marketing & loyalty, enterprise integration, community building, scalability, ease of use, easy flow of information and ROI.

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