TheNFAPost Podcast

Chennai, NFAPost: Hyperlocal fintech startup PayNearby has launched a module to bring the best of banking offerings – Nivesh (Savings), Udhaar (Lending), Suraksha (Insurance) and Payments at a store nearby. The platform is tailored to offer customised products, relevant to all income cohorts. Through its latest congregated platform, PayNearby aims to provide best of technology advancements, India Stack and leading banking and processing partnerships at the last mile.

Even as the government’s Pradhan Mantri Jan Dhan Yojana (PMJDY) initiative ensured that about 80% of the Indian population has a bank account, over 48% of them remain inactive with no transactions in the last one year. Additionally, according to the Indian Monetary Fund, only 13% of Indians make use of formal channels to borrow money. The rest rely on alternative methods like their local moneylenders, who often charge exorbitant interest rates, pushing them into an inevitable poverty cycle.

Also, the country’s insurance penetration is just over 3%, due to high premiums and erratic earnings – leaving them bereft of an insurance cover.  According to the India Savings Report, an independent study conducted by PayNearby this year, 60% of the low income cohort do not have access to a formal savings product, and continue to save either with a chit fund, or informal mechanisms like under the mattress.

Incepted in April 2016, Nearby Technologies is a fintech company offering financial/non-financial services to the underbanked and unbanked segment. Nearby Technologies works on a B2B2C model through its various brands – PayNearby, InsureNearby, BuyNearby and few more. PayNearby empowers retailers at the first mile to offer digital services to local communities, thereby boosting financial inclusion in India. Retailer services are focused on Aadhaar based banking services, Domestic Remittances, Bill Payments, Card Payments, and insurance services, among others.

It was founded by Anand Kumar Bajaj, Subhash Kumar, Yashwant Lodha and Rajesh Jha. It is the sole technology provider using Aadhaar Enabled Payment Services (AEPS) and IMPS to YES Bank, making them one of the two fintech companies hosted by the National Payments Corporation of India (NCPI).

PayNearby’s latest offering of a combined module, Nivesh (Savings), Udhaar (Lending), Suraksha (Insurance) and Payments, meets various needs through a single platform that simplifies high-end technology and brings it to the hinterlands of the country. The Insurance module aims to bolster insurance penetration in India by providing customised, tailor-made plan through its vast retail network, since these retailers enjoy certain trust and affinity for their surrounding communities.

The retailers, who have never sold insurance before, will be trained and educated to distribute it to a target group who has never brought it before, promoting dual empowerment. This will help improve accessibility to insurance plans, and thus mitigate vulnerabilities among the lower-income brackets, the startup said.

Similarly, the Savings module aims to inculcate a savings habit amongst the cohort, who avoid formal channels due to the lack of tenure flexibility, accessibility to financial systems and tech intimidation. PayNearby aims to prepare the segment to create a safety net for unforeseen circumstances and save to fulfil their life goals, by simplifying savings products and improving accessibility.

The Lending module will leverage big data analytics, artificial intelligence and predictive tools to help score millions of unbanked Indians who otherwise have been left out of the financial ecosystem. With the right partnerships and big data available at PayNearby (through processing of millions of transactions everyday), and the strength of on ground distribution network, PayNearby aims to provide the country with the right lending solutions to meet their growth and sustenance needs.

The Payments module aims to build upon the contactless transactions drive, triggered by the pandemic. Despite the fact that manual cash management is unsafe, inefficient and time-consuming for both entities involved, 78% of the population is still dependent on cash. Through the company’s assisted hyperlocal model and Digital Pradhans, they hope to make the latest advancements of digital payment technology available to the masses, in a format that is easily consumable by them.

“We are a developing economy, but when we are strategically aiming to move towards a $5 trillion-dollar economy, basic financial services such as – insurance, savings, lending and digital payments need to be treated as important as food, clothing and shelter. This Independence Day, we aim to offer financial liberation to the masses in our country,” PayNearby CEO and MD Anand Kumar Bajaj said.

“Reviving the economy requires kick-starting consumption, which is in turn dependent on lending and savings. But most importantly taking these ‘financial essentials’ to the masses including the bottom of the pyramid is what will drive the economy. Therefore, incorporating the unbanked and underbanked into the digital fold is imperative to bring about a tangible economic impact,” he added.

With the latest congregated platform, the startup aims to make financial essentials ubiquitous, whilst incentivising the masses with the right means, helping them embrace financial inclusion.

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