Razorpay gears up to digitise small businesses; aims at $50 bn TPV by 2021

Due to lack of trust, new merchants usually see 30% higher cart abandonments on the checkout page as compared to established merchants; Razorpay is aiming to change that

After raising mega funding of $100 million from Singapore’s sovereign wealth fund GIC and Sequoia Capital, newly formed fintech unicorn Razorpay is betting big to help small businesses to digitise.

The company is launching a string of products ranging from insurance to vernacular language support. These are aimed at empowering the next phase of digital growth for small businesses in India. The Bengaluru-based firm plans to achieve $50 billion TPV (total payment volume) by the end of 2021. This would also further solidify its position as one of the largest full-stack fintech companies in the country.

Razorpay’s new products launched at the company’s flagship event FTX are aimed to help small and medium businesses bounce back far more quickly. These solutions bring in agility and flexibility in business’s financial operations and cater to their payments and business banking needs.

Due to lack of trust, new merchants usually see 30 per cent higher cart abandonments on the checkout page as compared to established merchants. And over 90 per cent of overall orders are typically COD (cash on delivery), which in turn hurts the merchant’s profits. The Razorpay Trusted Badge helps customers know that the business is credible and trustworthy. A first-of-its-kind among payment gateway providers, the badge can have a drastic impact on the customer’s payment experience. This in turn would lead to higher conversions for the merchant. This badge will be displayed on the Razorpay Checkout and will be available to select businesses who are deemed trustworthy by Razorpay and its customers.

“The reason most customers prefer to shop on Amazon or Flipkart over small websites, is because you know that they are big brands,” said Harshil Mathur, chief executive and co-founder of Razorpay. “This Trusted Badge would help customers to find new small and young businesses which have a good track record for doing the right things and delivering products.”

 

India already has nearly 700 million internet users, of which more than 300 million prefer to interact in local languages. To deliver a localised payment experience to customers, the company has introduced a multilingual checkout page for thousands of non-English speaking merchants and customers from tier 3 and 4 cities. Most of these merchants are adopting digital payments for the very first time and this feature will help reduce the number of failed transactions. The Indian languages offered on Razorpay are Hindi, Kannada, Tamil, Telugu, Marathi, Gujarati, and Bengali.

“We have been tirelessly building tech-enabled solutions grounds-up, which has resulted in increased confidence from businesses across the country,” said Shashank Kumar, chief technology officer and co-founder of Razorpay. “Products launched  such as Vernacular Language Support and RazorpayX Vendor Payouts will further empower our goal to grow alongside small and medium businesses, as we look to achieve $50 billion TPV in the months ahead.”

Razorpay has also got into insurance. Less than 10 per cent of millions of Indian businesses can afford health insurance for their employees as the process is tedious, lacks transparency, and is expensive. This problem is magnified further for startups with less than 20 employees, especially when health insurance is key during this Covid era. To ensure they no longer have to struggle with this, RazorpayX has launched Group Health Insurance, in partnership with Plum and ICICI Lombard. It covers teams as small as two employees. Businesses using Razorpay Payroll can now avail benefits and affordable premiums within 60 minutes - premiums start at Rs 2 per day and cover pre-existing conditions and maternity.

Also, in a bid towards fostering innovation, Razorpay’s App Store will be the first B2B app store for the fintech industry. It would empower the developer community to build solutions beyond fintech. With Razorpay’s network of 5 million SMBs, developers can create flexible solutions and target a million businesses through Razorpay’s developer-friendly APIs (application programming interface).

“We are going through one of the biggest digital transformations in the history of fintech,” said Mathur of Razorpay. “The products that we’ve launched is an effort towards helping businesses with new possibilities to scale up (and) not just survive the pandemic.”

Highlights:

. Launches support in 7 vernacular languages for local payment experience in Tier 3 and 4 cities.

. Enters insurance, with product for teams of two to thousands of employees.

. Launches a B2B App Store to invest in building fintech infrastructure.

. Razorpay grew over 300% over the last twelve months.