The convergence of simplified business banking with accounting is happening at a phenomenal pace.
The latest player to get the global investment market excited is Indian neobank startup Open, which recently announced a $30 million funding round, led by Tiger Global.
Today the neobank allows new customers to seamlessly link or open a new business current account online, powered by Indian bank ICICI. From within the online banking platform, they can then issue simple invoices and receive payments, streamlining how the banking and accounting arms of their business interact with each other.
The approach taken by Open is almost identical to UK neobank Tide, which now claims 1 in 12 new UK business accounts’ is opened via its platform.
Open isn’t the only neobank in India worth watching.
InstantPay plays in a similar space to Open, minus the accounting bundling, with its suite of services extending beyond SMEs to corporates and individuals.
NiYO wants to own the banking relationship with salaried employees in India, offering 50% salary advances via its platform, at 0% interest. It also has a multi-currency Visa travel card and a tax-saving feature for employee expense management. Bank owned challenger brand Yono by SBI is also going after the consumer market.
Tiger Global aren’t the only US firm doubling down on Indian fintech. Facebook, who see opportunity in the tangential social commerce space, have taken a stake in Indian startup Meesho.
Meesho are effectively redefining the definition of a SME, enabling a new generation of Indians to establish home run businesses, reselling goods via its marketplace. Suppliers list goods, and resellers then market those goods out to their community of Whatsapp, Facebook and Instagram connections, setting their own margins. Collectively, resellers have access to 7 million customers on their platform, so a big carrot for suppliers to access.
The influence of cultural norms on how fintech’s develop is fascinating, and demonstrates the gulf that is expanding between how the west and the east think about innovation. Many take from the other (Open arguably from Tide), but undoubtedly some of the most interesting and novel applications in finance, like Meesho, are happening in the developing nations. There is no doubt in my mind this innovation will accelerate economic parity with more developed countries, and possibly even place western nations at a disadvantage from a financial infrastructure perspective, in the not too distant future.
Daily Fintech Advisers provides strategic consulting to organizations with business and investment interests in Fintech. Jessica Ellerm is a thought leader specializing in Small Business and the Gig Economy and is the CEO and Co-Founder of Zuper, a new superannuation startup in Australia.
I have no commercial relationship with the companies or people mentioned. I am not receiving compensation for this post.
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