Razorpay, the digital payment payment start-up funded by the likes of Tiger Global and Mastercard with more than 20,000 merchants on its platform, says it received a big boost through the demonetisation move of the government. The fintech start-up, which is 30 months old, will now focus on segments such as government and education as new growth areas, says Razorpay co-founder and CEO, Harshil Mathur in an interview with FE’s P P Thimmaya and Mahesh Kulkarni.
How do you see the digital payments space evolving in India?
There are a lot of issues and companies like ours need to solve them. Demonetisation has opened up whole lot of new segments which were earlier never geared for cashless transactions. Post demonetisation, the eco-system has changed a lot and opportunity has grown manifold. A lot of high value chunk of transactions is happening around without cash. Razorpay right now is 60-70% higher than the standard level transactions. Fintech is a new domain in India and lot of problems need to be solved by players like us. We also introduced new products such as link based payments, e-mail based invoicing, one hour activation etc. Digital payments is set to explode and we see huge opportunity in sectors such as education and government.
What are your focus areas in the digital payment space?
The most visible ones are in the B2C scenario where the primary use cases are consumers. On the other side are the B2B players where companies like us onboard merchants to accept all kinds of online payments. Our consumers are the merchants and we are a two-and-half-year old company who provide the simplest, easiest way to enable digital transactions as a payment gateway. Today, we have more than 20,000 merchants on our platforms which range from the smallest of retailers to large companies.
Which sectors have offered the biggest customers for Razorpay?
E-commerce is one of the fastest growing segment for us as they are also technology companies. The travel segment has also been one of the early adopters. The other segments like government and education will need some convincing. Today we have a significant merchant base and now we can go to the government. We will bid for the government tenders when they come up as we qualify for them.
What are Razorpay’s growth plans for 2017?
We expect a 10x growth this year in terms of volume and number of merchants will also double. We expand into newer verticals like government and education. We also have plans to go international in the next six to eight months like the South East Asia region where the problems are very similar to India. In some of the overseas geographies we will go independently while others we will look at partners. Though, demonetisation has opened up huge opportunity in India and we do not lose that focus.
Would Razorpay will look at more funding?
We are very well funded and we do not have that high burn rate. We want to just grow in the market with good run rate. There is no requirement for a fund raise. However, because of demonestisation, there is a lot of interest from the investor community and we might look at this at the end of this if we go international.
How do you see the competitive scenario?
There has been a lot of consolidation in the market. There are also not many players because it is highly regulated market and not easy to enter. We are still the youngest player and we have seen that some of the legacy players have not innovated. This could give an opportunity for players like Razorpay to take over. Our focus will always be to further improve on technology.