Fino Paytech banking big on tech disruptions

After raising ₹400 crore from various investors, Fino Paytech, one of the 11 payments banks awarded a licence by the Reserve Bank of India, looks to capture the under-served market.

The Mumbai-based player has oil retailer Bharat Petroleum Corporation (BPCL) as its lead investor with a ₹250-crore investment, while the rest has been closed with other investors, pending RBI nod.

Rishi Gupta, CEO & MD, Fino Paytech, maintained that the company will capitalise on technological disruptions to make banking swift, quick and effective. “Banking in India is getting disrupted by technology. Technology-driven innovations and operations make banking cost-effective. Our differentiation lies in our physical presence, our presence on the digital platform, and our tie-ups with players such as BPCL, ICICI Bank and several others,” he told BusinessLine .

Tech disruptions will change the way banking takes place in India, he said. “We are looking at a transformation in banking. Only those will succeed who are nimble and analysis-driven. It will be tough for some banks that have old systems and lack the agility to adopt new systems.”

Fino has already launched the beta version of its digital platform. On successful field trial, it will roll out operations by February 2017, the deadline set by the RBI.

“We will focus on the under-served areas, such as rural markets and urban pockets. While in the digital platform, we will have a pan-India presence, we look to start operations in the rural markets of Uttar Pradesh, Bihar, Madhya Pradesh and Maharashtra,” he said, adding that in a year’s time it will have over 400 branches nationwide.

“In Gujarat, we plan to spread our operations in 20 cities with 24 branches, out of which 8-10 branches will come up in Ahmedabad alone,” said Gupta.

As a financial products provider, Fino Paytech looks at the 40 per cent of India’s households that have an average annual income of ₹1-6 lakh. According to industry estimates, India accounts for about 21 per cent of the world’s unbanked population.

Currently, Fino Paytech has a gross transaction value of ₹12,000 crore, with revenues of ₹300 crore — a business it expects to see migrate to its payments banks business. The company’s corporate business comes from its business correspondents’ tie-up with banks, while its retail revenue comes from lending and remittances.

“Currently, the revenue share of corporate and retail is 55 per cent and 45 per cent, respectively, but going forward we see this ratio changing in favour of retail to 40-60,” he added.

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