“Payment companies are fast becoming dinosaurs”

Within a decade, India has created a conducive, competitive environment amongst fintech companies. But tough competition in the market has driven companies to give innovative, customised digital payment solutions for every business segment; whether B2B, B2C and/or D2C. 

Speaking with IBT exclusively, Rahul Tandon, Chief Product Officer, Safexpay, said that both small and large businesses require more than just a digital transaction gateway. The company’s CPO believes that payment companies have to rise above payment transactions and provide small businesses with holistic solutions on financial tally and bookkeeping. 

Photo Source: Safexpay

IBT: In India, the fintech industry has taken a big leap, with many established players in the domestic market. What makes Safexpay different from its competitors?

Rahul Tandon: The founder and co-founder of the company had previously worked for fintech and digital payment companies. We observed that there was ample scope in the market to expand the digital payment framework. Most of the big companies themselves were looking for some solutions because everybody has their own out-of-the-box limitations. So, Safexpay’s journey started as a Token Service Provider (TSP). The cofounders felt that most of the big companies lacked optimization and hiring efficiency, among other critical aspects. Our company slowly graduated to providing white-label platforms and solutions, and even today many of the big companies are using it.

Then, it started graduating to its own platforms and businesses, and slowly ventured into new banking side, pay outside. We are yet to receive Payment Gateway (PG) clearance from the Reserve Bank of India (RBI), which I believe is four to six months away. So, we are still in the mode of providing solutions and but we are providing a lot of virtual services.

IBT: The D2C segment has exponentially grown in India in 5 years. How does a fintech company such as yours support this emerging sector? 

Rahul Tandon: Our business approach has become organic and platform-based. What we’ve done is we are going for end-to-end organic solutions for all our clients. The D2C segment, within a minimal workforce, has to spend time on generating catalogues, order books and expense management solutions, and managing discounting mechanisms. This is where we come in, a time-saving solution for D2C, by offering multiple services under one umbrella.

The biggest mistake this industry and the analysis does is – looking at the end payout which is nothing but a multimodal, multi-payout solution or multiple collections. So, we tend to think we understand the business decision and output of the customer. That is a decision already taken by the customer based on his business or retail needs. But, we have never realized in this analysis, why that decision has taken place. So now, we are going for a platform approach; come, plug into our company, and whatever you may need, I can help D2C with their payout and collections. We have taken that approach.

Also, we have flag-poled our strategy by first hitting the lower segments, the B2C players who are probably surviving or a tally or an excel sheet management. It may be easier to approach bigger corporates but the small B2C players require hand-holding support for marketing expenditure. First, we targeted the bigger ones, which has started giving me revenue and collections. Then we created a pool and started going to the B2C segment.

IBT: How do you anticipate the next course of expectations from payment companies? 

Rahul Tandon: In my opinion with payment companies we are probably barking up the same wrong tree. What I realize is today every company has got COO on board and he does his expense management, budgeting everything on the tally. The secret behind the success of a company can be attributed to how you are utilizing the market data to develop your own services. That is very critical.

So today, I’m giving you an end-to-end solution, catalogue management to cloud storage in a consolidated form, which allows the company to tally their overall data and articulate the information to evaluate operational strategies. The user becomes his own adviser. They can assess what is his current revenue expenditure. How would a company capitalize? So, payment companies are fast becoming dinosaurs.

We have to provide more services in data, analysis and business solutions. For me, payment would always be one of my pillars, because we are very good at that. But it would be the endpoint, not the beginning.

IBT: Safexpay is also expanding its hold in the UAE market. How did the decision come in place to enter the GCC countries? 

Rahul Tandon: It was during the COVID-19 era wherein we decided to enter into the GCC regions. One of the founders got stuck in Dubai during the outbreak of the COVID-19 pandemic and couldn’t return to India. So, he utilized this time to study the GCC market. We started the journey in GCC countries beginning in Dubai by offering the same products and services we did in India. We approach companies in Dubai, the banks, and the country’s central banking authority. This is how our journey in the GCC market started.

We’ve joined hands with some of the prominent banks such as the First Abu Dhabi bank, giving them complete payment solutions along with joining hands with their PSPs. Now that we have matured there, we have applied for licenses in most of the GCC countries and also in one or two African countries.

We have already been appointed as Payment Service Provider (PSP) for one of the banks there and have applied for licenses, which we will receive very shortly. And in the meantime, we have come up with very innovative solutions in the Middle East. We have brought the metaverse solutions for tcatalogue management and we’ve already started implementing that.

IBT: What are the major difference between the Indian and GCC markets for fintech requirements?

Rahul Tandon: The fintech industry here is so large and so is the competition in India that when a product debuts in the market with anything new, it is virtually for free, right? Now the stark difference is in GCC countries. They do have foreign players but none of them are as savvy as the players we are, so, the private companies in GCC are ready to invest in our products.

Notably, data analysis is common to both sides. However, in India, the government has come up with open data platform initiatives like ONDC to support smaller e-commerce companies, whereas similar players in the Middle East would already be mature.

IBT: Digital payment methods came to India maybe a decade or more ago but the market is yet to mature. So where is the improvement required in your opinion?

Rahul Tandon: Digital payments facilitated a lot of business, good business because suddenly it led to a lot of curation. Small entrepreneurs, or middling entrepreneurs, who would be struggling, suddenly found a great avenue through digital platforms to promote their businesses. But there’s coming to a stage where everybody’s just repeating themselves. The time is now to move ahead. Now, the bane is that you want to keep reinventing yourselves. Fintechs are creating solutions from business perspective payments, are very generic so people should be able to build their USP.

If we start thinking like that, otherwise for any solution or business, there are no entry barriers no matter how big you think you are. And in the AI times, it has to become very intelligent, where people are able to dip into data and think.

IBT: Artificial Intelligence has entered almost every major segment, what role does it play now in the fintech sector? 

Rahul Tandon: One may start by seeing what is AI doing. Any algorithm which is trained to discern some patterns is dipping into what is already existing in the digital world and then doing the best for you. Now, one is to let your platforms or your existing businesses use AI efficiency optimization, and marginal costing on the businesses. Secondly, from within the business, AI should be helping companies to analyze what better they can do, and what is the next step they can do.

AI can help build a storefront, catalogues, inventory management, and expense management. We can build some algorithms around AI to keep the finance track afloat. The founder of the company can realize what is going off the shelf and what is not going off the shelves. AI can be trained to his own thinking. That is the best way forward.

IBT: On the cybersecurity front, how do you ensure that Safexpay is protecting its client’s data and it is more resilient towards cyber crimes?

Rahul Tandon: Cybercrime has been affecting everybody. We also face attacks day in and day out and we are not the only ones, the big ones face even more problems. So very frankly, we hit the market, whatever is the best. Let’s say you have to follow the ISO standards, keep doing your VAPTs, and internal and external. But the problem is, thanks to cyber crimes, it is getting more expensive by the minute to maintain and safeguard technology.

We developed our internal tools and invested very heavily in safeguarding our products against hacking. To survive in this business, you have no way out. Companies have to constantly evolve.

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Rahul Tandon is the Chief Product Officer (CPO) of Safexpay and has three decades long experience in the banking and payments domain, with a specialisation in new product development. He has been recognised for platforms such as Bharat Bill Payment System (BBPS) and was the Head of Product, Market Development, and Compliance at the National Payments Corporation of India (NPCI) for 8 years. He also worked closely with NABARD as its Assistant General Manager for over 10 years.