In an exclusive interview with Sanjeev Sinha, Mr Ronit Harisingani, Co-Founder, Spare8, talks about micro-investing and how does it help individuals who may not have large amounts of money to invest. Excerpts:
What is micro-investing and how does it differ from traditional investing?
Micro-investing is a modern investment strategy that is quickly gaining traction among new investors. Micro-investing entails investing small sums of money in financial instruments such as stocks, digital gold, exchange-traded funds (ETFs), and mutual funds. It is frequently used to gradually build up a portfolio on a limited budget.
It is a strategy that anyone, regardless of financial situation, can use to begin investing in various financial instruments. The primary benefit of micro-investing is that it allows people to invest without requiring a large sum of capital.
Large sums of money are commonly invested in stocks, real estate or mutual funds in traditional investing to reap the benefits of long-term investment. Micro-investing, on the other hand, allows investors to begin investing with as little as Rs 1. This way, they can gradually build a portfolio that will eventually grow to be substantial.
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What are the benefits of micro-investing, and how can it help individuals who may not have large amounts of money to invest?
Here are some potential advantages of micro-investing in India:
1. Accessibility: Micro-investing can provide an accessible entry point for individuals who may not have a lot of money to invest upfront. In India, many micro-investing platforms like Spare8 offer low minimum investment amounts as low as Re1, making it easier for people to get started and accessible to the masses.
2. Cost-effective: Traditional investment methods can come with high fees and charges, which can eat into your investment returns. It offers low or no fees, making it a cost-effective way to invest.
3. Diversification: Micro-investing platforms can help individuals diversify their investment portfolio by offering a range of investment options. Spare8, for instance, allows investors in India to invest in digital gold
4. Convenience: Micro-investing platforms in India can offer a convenient way for individuals to manage their investments. Spare8, for example, allows investors to purchase and sell digital gold with just a few clicks on their mobile devices.
Spare8, in particular, offers a unique way to invest in digital gold, by leveraging upon the UPI (Unified Payments Interface) 2.0 stack. The fintech startup has been able to create one of the fastest on-boarding processes ever (< 30 secs). No KYC, no scanning of documents, no bank details required for users to start their investment journey.
How does Spare8 work and what types of investments does it offer?
Spare8 is a new way to save, invest and earn rewards. Through Spare8 you can automate your investments and create a daily savings habit without doing anything at all. What’s more is that you also get stable returns on your savings as it’s invested into gold. Simultaneously, it rewards you for your everyday investments and puts the power of gold savings right at your fingertips!
Spare8 is more than just a platform – it’s a vision. The vision being to make “Spending the new Investing”, where users earn rewards by playing slot games for every rupee invested.
How does Spare8 ensure that its users’ investments are secure and protected?
At Spare8 we use bank-level security, our app is secured with 256-bit encryption. We ensure that every purchase of gold you make is stored in world-class vaults and secured by a SEBI-regulated independent trustee so you can enjoy guaranteed 24K gold.
Furthermore the gold savings app has tied up with Augmont, one of the only 3 regulated bodies by the RBI to deal in Digital gold; Augmont ensures safety and genuineness of all purchases made through the app.
Spare8 also provides a 24/7 customer support that helps you with any issues that you would face while transacting over the app.
There are some risks associated with micro-investing. How does Spare8 address those risks?
A – Rupee cost averaging: Instead of purchasing gold at a single price point, with Rupee cost averaging you buy in smaller amounts at regular intervals, regardless of price.
When customers purchase gold over time at regular intervals, they decrease the risk of paying too much before market prices drop.
Basically, if you divide up your purchase and make multiple buys, you end up maximizing your chances of paying a lower average price over time. This method of investing and saving is the most powerful way to get started with.
B – Market Volatility: Investing in general is subject to market volatility, which can cause fluctuations in the value of your investments. Spare8 addresses this risk by providing educational resources that can be found on their website and market insights to help you make informed investment decisions. Furthermore, Spare8 as a platform helps users micro-invest in digital gold that has always proved to be a stable investment and has been used in times of inflation and uncertainty.
C – Security: One of the major concerns of micro-investing is the security of your personal and financial information. Spare8 addresses this risk by using top-notch security measures to protect your personal and financial data. The platform uses 256-bit encryption, which is the same level of security used by banks and other financial institutions. Additionally, Spare8 has tied up with Augmont to provide guarantee while assuring you of purity and safety of your investments.