SoftBank-funded fintech mobile balance checking app, True Balance is targeted at feature phone users and those smartphone users for whom online payments are disabled. Offering small time loans to consumers especially in the rural markets, True Balance has gone the extra mile to make a mark as a key enabler of bridging the digital gap in India and has also strived to bring in the much-needed inclusivity for Digital India.
Speaking with the CEO of True Balance, Victor Choi, elaborates on the nature of feature phone users and how by offering recharge loans, insurance and other services for the unbanked users, True Balance is making in-roads into the tier 2/3 markets. The interaction is as below:
Voice&Data: What is the size of the market for fintech players beyond urban areas?
Victor Choi: To truly make India a digital nation it is important to get the unbanked population comes online. While there are firms catering to the urban metros, it is the tier 2 and tier 3 markets that hold the real potential. Brands should modify their business models to move into financial services for that section of the economy who need money for living as small loans to fulfill their basic needs.
Brands should focus on providing financial services, products, and items suiting their needs like recharge packs, insurance, small loans, etc.
Services are meant to empower Indians beyond just the metros and create greater financial inclusion. Brands should focus on providing financial services, products, and items suiting their needs like recharge packs, insurance, small loans, etc., which makes it easier for the users to make their daily transactions.
Voice&Data: What are the challenges of creating a fintech platform in a low-bandwidth environment?
Victor Choi: India has a huge population that uses fintech services, but realistically, I feel the majority of the population out there cannot enjoy this mobile fintech because they do not have smartphones that enable online payments, or recharges, as they use feature phones and hail from low-bandwidth areas. There is a large section of India’s population that does not benefit from the convenience of the mobile fintech service.
The important issue here is to find solutions for higher penetration of smartphones and find ways to keep the software light that can help smooth and seamless experience even in low bandwidth areas.
Hence, covering the entire population is the real challenge. It is important to have a proper agenda to reach out to this part of the population and True Balance is currently focused on this agenda. The important issue here is to find solutions for higher penetration of smartphones and find ways to keep the software light that can help smooth and seamless experience even in low bandwidth areas. This will eventually lead to more people enjoying fintech services.
There is a definite potential of the fintech domain in India and a lot of global players are coming into the industry. But one challenge is the regulations around it. Everybody knows that mobile fintech is a new domain; many things are happening over online mobile. The government also has been working closely to introduce policies that will regularize the fintech industry making processes like applying for licenses, receiving KYC, etc more seamless.
Currently, True Balance has more than 70 million downloads clocking 3 lakh transactions daily and aims to bring financial freedom to primarily unbanked users by giving them a safe, fast and convenient transacting experience.
Voice&Data: How is True Balance creating a financial impact?
Victor Choi: Financial infrastructure is not well established in India. People do not deposit their money in the bank because it is a low-credit society. Online payment is also the same. TrueBalance understands this problem and has planned accordingly to provide benefits through financial technology to unbanked users. We started as a utility service provider and not as a financial service provider. May be that helped us accumulate users who don’t have bank accounts and that made it easier for us to understand our customer needs and deliver accordingly.
Understanding the market need, we introduce services like insurance, instant cash loan to our consumers. Our recently launched service True Pay Later is focused for unbanked users and it has a strong demand for instant credit service. This unique service not only allows our users to avail small amount of money under Rs 1000 INR as “money for living” but also allows all True Balance services such as the one-tap payment of electricity bills, mobile and DTH recharges with the option of payment with 10-day credit period. The service has received a phenomenal response from consumers clocking half a million transactions in just two months. It provides them a flexible payment period as per their needs. True Balance works on an internal, alternative credit scoring system to validate the credibility of its customers for credit service repayment.
Currently, True Balance has more than 70 million downloads clocking 3 lakh transactions daily and aims to bring financial freedom to primarily unbanked users by giving them a safe, fast and convenient transacting experience while also bringing them under the umbrella of financial inclusion right on their doorstep.
Voice&Data: How is True Balance building an ecosystem to create financial inclusion for that section of the economy where accessibility is a major issue?
Victor Choi: India is an optimized country for marketing that utilizes people. True Balance targets tier 2 & 3 markets where they share a strong bond between relatives and region. Buzz marketing is a powerful tool. It is also useful to target region which uses minor languages. India is now facing a smartphone trend. People tend to recommend useful applications to their surrounding people.
True Balance is focusing on providing innovative financial services to people with little or no credit history.
To create greater financial inclusion in these areas True Balance has partnered with loan merchants to provide small loans and insurance services. True Balance works on a unique credit scoring system to determine the repayment capabilities of its customers. In a market where a majority of the population do not have CIBIL score, the company relies on its strong data science capabilities to analyze data on user consumption, the kind of apps they use and SMS pattern, etc. True Balance is focusing on providing innovative financial services to people with little or no credit history, who may not be served by traditional and formal banking routes. By availing such innovative financial services, True Balance users can build and strengthen their credit scores which enables them to have better access to financial products and services.
The company plans to launch commerce, where users can purchase mobile phones, railway and bus tickets with an option to pay in installments. The company is in the process of getting a non-banking financial company (NBFC) license and expected to kick off the service within the next few months.
Voice&Data: What is your comment on industry growth and trends?
Victor Choi: Let me list that:
- Digitization of Financial Services: According to a survey by PWC, 49% of consumers now conduct their banking primarily on their desktop or smartphone. With digitalization, customers now frequently access automated versions of these services online, allowing for more convenient and seamless experiences.
- The rising number of payment options at retailers: We see a major shifting with consumers moving from physical payment in cash to credit, debit, gift cards, as well as digital payments from mobile wallets on phones and wearables & money transfers from apps. For many firms, offering such a complex web of payments options requires working with third-party FinTech firms that offer such services.
- Easier Small lending: The Indian Government’s inclination to make small-lending easier on the lender and more accessible to the borrower through its support to fintech firms is important. In recent times we have seen a positive shift, where consumers have preferred digital lending platforms over traditional banking services.
While the fintech industry consists of a diverse set of firms, business models, and areas of focus, we believe it is well-positioned to experience outsized long-term growth.
In the month of June, we launched a new service, Recharge Loan, for all recharge services provided by us. Recharge loan will make the transaction easy by giving payment option in 3 installments
Voice&Data: True Balance offers recharge loan. Elaborate on that and do talk about your upcoming services.
Victor Choi: In the month of June, we launched a new service, Recharge Loan, for all recharge services provided by us. Recharge loan will make the transaction easy by giving payment option in 3 installments within the time frame of 20 days. The first installment will be deducted immediately after availing the service. With a nominal interest rate, the minimum amount to apply for recharge loan is of Rs 100. This service can be availed by anyone who is our Gold members for the last three consecutive months.
True Balance is planning to foray into new business segments like e-commerce on handset, insurance, recharge loan, and Travel and Hotel booking, etc.
True Balance is planning to foray into new business segments like e-commerce on handset, insurance, recharge loan, and Travel and Hotel booking, etc. The program aims at enabling all True Balance customers to get benefits with each service. Anything related to small finance which is fit to our customer character and nature is our focus right now and that will be our area of concentration.
Voice&Data: How has True Balance increased focus in rural markets?
Victor Choi: True Balance is an app for the billions, and we are aligned with PM Modi’s vision of Digital India. While supporting the Digital India policy, True Balance has also been creating job opportunities in India helping the economy grow. We have huge expansion plans for India and look forward to contributing to the booming Indian fintech market.