Online payment solutions provider Instamojo is looking to transition to a full-stack service provider for micro small and medium enterprises (MSMEs) this financial year.

This means that Instamojo will not only provide micro enterprises a secure and faster payment system, but also help them in selling, managing and growing their businesses. The company might also provide logistical support and help them in getting loans and micro-credits.

Sampad Swain, Founder and CEO of Instamojo, told BusinessLine that the company will be partnering with leading players in the industry to help grow the SME segment in the country that also includes soloprenuers or homepreneuers.

“Payment is definitely an important aspect of business and we have seen a massive growth in our business by just targeting small businesses. However, the businesses are asking for more. They also want to grow their business and hence we are thinking of helping them by offering them services beyond payments,” Swain said.

Revenue growth

He added that the company’s payment revenues have grown 103 per cent per annum in the last two years, much faster than the payments industry’s 60-70 per cent.

The Bengaluru-based company currently has about half-a-million merchants on its platform and charges a 2 per cent commission from these merchants every time they make a transaction.

Besides, most of the businesses have an average annual turnover of ₹7 lakh and don’t fall under the GST regime, which in a way makes it easier for the businesses to focus on growth.

“There are about 60 million SMEs in the country and, of that, about three million are digitally active. Ninety per cent of the market is unexplored. We are expecting to tap a million sellers on our platform in FY19,” Swain said, adding that the company is targeting a revenue run-rate of ₹6,000 crore during the fiscal from the current ₹1,000 crore.

Dearth of finance

Swain further added that dearth of finance is a major impediment for the businesses and that needs to be solved.

While banks do not want to focus on such businesses, the new age digital lending players are focussed on tapping the urban players.

Instamojo competes with other B2B-focussed payment services like Razorpay and CCAvenue. It also provides GST services and also help the businesses manage their respective web-store.

The company, which has raised around $7 million in total from investors like Kalaari Capital and Blume Ventures, among others, is hoping to close a bigger round in the next couple of months.

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