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How this fintech firm helping rural India avail of banking services

Manipal Business Solutions has created 8,000 financial inclusion points across all States; The firm has tied up with 12 banks and plans to work with 25 banks on financial inclusion in next couple of years

Kamaljeet Rastogi, CEO of Manipal Business Solutions
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Kamaljeet Rastogi, CEO of Manipal Business Solutions

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Indian financial services landscape is rapidly changing. Entry of technology-powered fintech firms is bringing in a paradigm shift in the way financial services are delivered. App-based digital players are making the process not only seamless, but also are democratising the access. That is the reason that banks are increasingly partnering with fintech players to penetrate new market in the hinterland. As rural banking and banking correspondent model tap the technology solutions, the reach of formal financial institutions in rural areas is also increasing. Manipal Business Solutions is an innovative fintech player, which is engaged with many marquee banking institutions to realise the dream of financial inclusion. With banking correspondents spread across the country, the company is also managing rural branches of banks for delivering services. In a conversation with the Bizz Buzz, Kamaljeet Rastogi, CEO of Manipal Business Solutions, said that with vast network of merchants, the company is also planning to enter the MSME lending segment through its SahiPay app in partnership with banking partners. The fintech firm may also look at retail lending in the form of agri lending in the coming years. In terms of growth, the company is expecting around 40-50 per cent growth in the coming financial year on the back of its new initiatives.

After the creation of Manipal Business Solutions, which is focused on fintech segment, one of the first businesses it entered was financial inclusion when the banking correspondent concept was introduced. In the second step, the company created its own payment platform called SahiPay. Here, all kinds of financial and other services including bill payment, insurance, ticket booking can be done by the customers. Other segment, the firm has entered into is the software solutions like fraud and risk management, anti-money laundering leveraging advanced technologies. The company serves customers both in India and abroad through these solutions. The fintech firm also provides a virtual card for online transactions

The firm is looking at a 40% growth in its top line this fiscal year. For the next financial year, the company is likely to see 40-50% growth in revenues. The company is also planning to enter the MSME lending segment through its SahiPay app in partnership with banking partners

Will you throw some light on the evolution of Manipal Business Solutions over these years?

After the creation of Manipal Business Solutions which is focused on fintech segment, one of the first businesses we entered was financial inclusion when the banking correspondent concept was introduced. In the second step, we created our own payment platform called SahiPay. Here, all kinds of financial and other services including bill payment, insurance, ticket booking can be done by the customers. Other segment, we entered into is the software solutions like fraud and risk management, anti-money laundering leveraging advanced technologies. We serve customers both in India and abroad through these solutions. We also have a virtual card for online transactions.

Can you give some picture on how much revenue is drawn from fintech side in percentage term? Is it the biggest vertical?

Yes, fintech is the biggest vertical for Manipal Business Solutions. Almost 90 per cent of our top line comes from fintech vertical. Within the finetch, financial inclusion is one of the biggest and we are currently present in 8,000 points across all states. We have mandates from ICICI Bank, State Bank of India (SBI), Central Bank of India, Kotak Mahindra Bank among others. We are working with all these banks to create financial inclusion points. We also work with rural livelihood projects with mandate from the World Bank. We are working in UP, Odisha and two other States. This is a unique model of financial inclusion where women entrepreneurs are encouraged to pick up business activities. Overall, financial inclusion is a profitable model for us. We have tied up with 12 banks on the financial inclusion side. We plan to work with 25 banks or so in couple of years. Banks are quite keen to expand this model because there is no fixed capital expenditure for the banks. Even rural banks are partnering with us for setting up BC (business correspondent) points.

Also, banks are coming to us for establishment of rural banks. As per the Reserve Bank of India mandate, each bank has to open one rural branch for opening three branches in the urban areas. This has become a regulatory necessity for banks. So, many of our partners have come to us for opening such branches. Currently, we are operating 150 such rural extension branches and we are in the process of another 50 such branches. These branches are operated by us though the branding is of banks.

What is your level of engagement with the new age fintech players where a majority of the operation is app-based?

Yes, this is the new area we have entered. The fintech players also require services in terms of KYC (know your customer), and other things. We have recently tied up with OneCard for these services. We are looking at other players for such tie-ups. Technology-driven fintechs will be able to reach many areas which have not been touched by banks. So, retail banking will penetrate further.

Will you give some insights on the emerging concept of embedded fintech? How are you approaching this space?

Embedded fintech enables customers to do a lot of non-financial transactions. For instance, for a purchase, you get a purchase loan. This market is growing very fast. MSME sector is the most credit-starved in India. Sensing the opportunity, many fintechs are entering into this space. Technology plays a big role here. Through technology solutions, credit can be disbursed on real time basis. In SahiPay, we are having a network of two lakh merchant points across the country. Through one platform, end-consumers can pay their utility bills, make cash withdrawals & deposits, transfer money, buy insurance policies and much more. We will also enable loan disbursals through partnerships with banks and NBFCs. We are just starting on the lending side and looking at launching it by March. We will start B2B (business to business) side of lending focusing on merchants. B2C (business to consumers) definitely sits on our plans as we have a huge amount of data. In fact, agri-lending is one of the spaces in which banks have approached us. Also, our money transfer clients can be tapped for small ticket personal loans.

How does the business growth look like by the end of this fiscal year? What are your expectations for the next fiscal year?

We are looking at a 40 per cent growth in our top line this fiscal year. We want to be conservative. We are part of a big group. For the next financial year, we are likely to see 40-50 per cent growth in revenues. We are not factoring on the lending aspect as we are going to start it shortly.

Debasis Mohapatra
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