Innoviti payment solutions: technological obstacles plague the digital payment industry: Innoviti

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Fintech player Innoviti Payment Solutions aims to use technology to add intelligence to payment transactions, helping merchants, banks and brands harness the power of digital payments. Innoviti claims to have processed over $ 6.5 billion in merchant payments from 1,000 cities. The company is backed by renowned investors such as Catamaran Venture, Bessemer Venture Partners and FMO (Netherlands). In an interaction with ET Online, Rajeev Agarwal, CEO and founder of the company, spoke about the main differentiators of the company and its upcoming projects. Edited excerpts:

ET: What are Innoviti’s main differentiators that set it apart from the crowded national fintech market?
Rajeev Agarwal (RA):
We extract better value from a payment transaction than anyone else. This helps merchants reduce back office work or helping them gain and retain customers. In addition, our solutions are customized for each category, integrating perfectly into the business processes of traders. Our current solutions focus on the fashion, electronics, healthcare, food and grocery verticals.

We have filed 26 patents and obtained two patents. As we speak, Innoviti has filed more technology patents than all the payment companies in India combined. We are the first and only SOC3 certified payment platform, whose claims on the reliability, speed and integrity of transaction information have been validated by SOC3 processes.

ET: New digital payment trends are now shaping the future of the payments ecosystem. Is India missing the bus?
RA:
With a compound growth rate of over 50% year-on-year, digital payment adoption in India has seen accelerated growth during the Covid-19 pandemic. Massive transformation, however, comes at a cost. Yet, in an initial phase, our digital payment industry faces several structural and technological challenges. Transaction failures, security incidents, breakdowns are frequent. Whenever such an incident occurs, it results in a loss of confidence in the consumer and the merchant. Part of the reason is that gamers have been busy acquiring more customers and not spending as much time and money to bolster their operations. This needs to be fixed quickly, otherwise it will lead to a cap on digital payments penetration. The other area where innovation is lacking is B2B and offline payments. These can open up new sources of revenue for the industry.

Rajeev Agarwal, CEO and Founder, Innoviti.

ET: A large portion of SMEs, especially its unorganized segment, remain untapped and reluctant to join a tech-driven bandwagon. What is your opinion on this?
RA:
Many small businesses in India are reluctant to support digital payments primarily for two reasons. Lack of awareness on various aspects of using digital payments and secondly due to lack of dispute resolution.

However, we believe that another more important reason is that they are unclear about the benefits of digital payments, as cash is convenient and a safer option from their perspective. Focusing on solutions that can help them use digital payments to grow their business, such as providing IMEs or co-marketing programs, can attract faster adoption. For example, today’s small traders are faced with the onslaught of online gamers wooing their customers with zero-cost EMIs and other offers. These merchants lack scale and therefore do not receive support like brand cashbacks or better trading rates from partner banks. However, there are many companies that want to lend to them.

The real problem is a product-market gap. When these small retailers are unable to sell products, why would they need more money to buy stocks? Innovative products can help unlock this segment, leading to rapid adoption. Our GENIE marketing app fills this gap by creating a level playing field for these small, major retailers with their online competition.

ET: Why is it imperative that India put in place a secure, reliable and robust payment infrastructure?
RA:
Led by government digitization initiatives and coupled with an exponentially increased use of contactless payments during the pandemic, acceptance of digital payments has exceeded all estimates. While millions of Indians conduct digital transactions, the infrastructure is not robust enough to handle such large volumes due to low investment in telecommunications. In addition, people are unfamiliar with payment technologies and digital technologies in general. In this context, technologies must be secure and scalable, otherwise people will lose confidence. Building a secure, reliable and robust payment infrastructure will help improve the digital payment experience for merchants and end customers and unlock the true potential of digital payments in India.

ET: What are Innoviti’s projects in India?
RA:
We have a 16% market share of all digital payments that occur, with a 30% market share in fashion in organized commerce. This part of the business is profitable and our short term goal will be to make the cash flow positive over the next 6 months.

With the introduction of our new product, GENIE, a smart marketing app for major mobile retailers, we are actively working to extend our leadership from organized commerce to small resellers in the mobile segment. We will also launch similar targeted products for the healthcare, automotive, and food and grocery segments in the coming quarters. In the long term, we want to take leadership in the organized and general trading segments of these categories and aim for an IPO by 2023.

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