We will put our cross-border platform into play, says Tide India CEO

'The Indo-UK trade involving SMEs is now at around a few billion pounds annually', says Gurujodpal Singh

The London-based Tide, which has a market share of six per cent of the United Kingdom’s (UK’s) small business segment, has made India the first stop in its global foray. It has raised over £100 million in investment from a clutch of investors. It is a rarity among fintechs, since it has a cross-border platform. Gurujodpal Singh, chief executive officer of Tide India, spoke to Raghu Mohan about the company’s plans. Edited excerpts:

What is the scope of Tide’s ambitions in India?

We are a neo-bank focused on small and medium enterprises (SMEs). The core of the product is the bank account, for which we have recently partnered with RBL Bank. But along with that on our platform, we help SMEs to run their entire piece of financials and administration to save on money and time. Today, they do banking, taxation, and invoicing on different platforms that don’t talk to each other. I mean, one needs to manually move data from one platform to the other.

An example is sharing your invoicing details or bank statements with chartered accountants for taxation. We solve these issues. And we do collections as well. Our “Alpha” product, which is for friends and family, is now live. And the “Beta” version will go live this quarter. We shall onboard the first set of users over the rest of 2021. And we will go in for a full-fledged launch in early 2022. In the first year, we plan to onboard 25,000 SMEs on our platform, and over three to five years, we intend to serve two million SMEs.

What are the drivers behind your Indian foray?

We have gained significant traction in the SME banking channel in the UK market with 6 per cent market share. Practically one out of 20 SMEs is now a Tide customer. We believe it is the right time to expand internationally. Our intent is to serve 25 per cent of SMEs globally. From that stand-point, India becomes very interesting, because 10 per cent of the global SME population is out here. And because there has been a massive push towards digitisation from the government’s side and the way smartphone penetration has moved.

India has also a very vibrant fintech ecosystem, and banks are pretty open about partnering with it. The fact that there is an inherent digitisation DNA in the overall financial ecosystem is very important for somebody like us. The pandemic has also pushed the ecosystem towards this. And, you also have the talent — be it products, the technology involved, or people — which has been built up over the last 10 to 15 years. My belief is that the Indian market will bounce back much faster than others. Recovery is going to be strong, and SMEs will always play a very important role.

How do you view the local SME segment?

SMEs are quite similar all over the world. From a target market stand-point, the pain-points are similar and hence, we feel we could replicate all those value propositions from the UK to the Indian market. Our mission is to help SMEs digitise. We did this improvement on the existing banking ecosystem and from there we started building various things for SMEs. That’s the reason we grew so well there.

But having said that, our range here is different from the UK. There are certain pieces which are very unique. I mean that there are certain pieces which are unique about India which we are inculcating in our product line, like the Unified Payments Interface, and the Goods and Services Tax.

You are one of the few fintechs with a cross-border platform. How do you propose to leverage it?

There are many things we could build for Indian SMEs, which will also be much useful to such entities across the world. And we intend to encourage cross-border trade. So, if an SME offers a service, and there are others on the platform who want to use this service, we intend to facilitate it. Indian SMEs serving global markets need to have the ability to collect and pay in multi-currencies digitally. Also, SMEs may use services or buy from others on the platform.

You should also look at the larger setting. The Indo-UK trade involving SMEs is now at around a few billion pounds annually. Both the Indian and the UK governments are working towards establishing closer trade ties. And after Brexit, the UK is looking at more of the bilateral outside the European Union. And then you have the global supply chains and manufacturing hubs which are looking at alternatives outside of China. India could be a big beneficiary because of this. And in all of this, SMEs will have a big role to play.

While technology will undoubtedly reshape how these entities go about their businesses, they will also create significant employment opportunities. And keeping in view the business potential, we plan to invest 100 million pounds out here. For the moment, we have tied up with RBL Bank, but we will also be working with a bunch of other fintechs and institutions. We also operate a tech-centre out of Hyderabad, which was started in early 2020.