Jaipur-based last mile rural distribution startup, Frontier Markets, on Monday announced that it has raised $2.25 million in a Pre-Series A funding round led by ENGIE Rassembleurs d’Energies, The Rise Fund, and The Singh Family Trusts (advised by Artha Impact), along with Teja Ventures and affiliates of Beyond Capital Fund.

 

Founded in 2011 by Ajaita Shah, Frontier Markets is a last mile-assisted ecommerce and distribution company that leverages its network of tech-enabled women agents to market, sell and service products and services across rural India. 

 

The current investment will drive the company’s assisted ecommerce platform to the next level, adding digital marketing tools, AI-enabled digital training, and a B2C solution onboarding its rural customers directly on its digital platform, it said. The company will also leverage its B2B2C ecommerce to drive digital and physical services to rural customers and become the primary income source for rural women.

Ajaita Shah, Founder and CEO of Frontier Markets

Ajaita Shah, Founder and CEO of Frontier Markets

Also ReadFrontier Markets: A Lesson in Rural Product Positioning and Marketing

 

Frontier Markets claims to have over 4,000 women entrepreneurs who are tech-enabled using its proprietary assisted ecommerce platform to deliver over one million products and services to 700,000 rural customers in Rajasthan, UP, and Bihar. The company said it is associated with several partners including Samsung, Crompton, HUL, Eko India Financial Services, and more to curate products based on data insights collected through its tech platform.

 

In response to COVID-19, Frontier Markets launched doorstep delivery of essential goods and digital banking services as a response to the challenges presented by limited access to supplies in rural India. 

 

Ajaita Shah, Founder and CEO of Frontier Markets said, 

 

“Prior to COVID-19, Frontier Markets invested in a technology platform that leveraged data to deliver a wider range of products and services in energy, finance, connectivity, agriculture and more to the last mile consumer, digitally onboarding all of our agent network. Today, we have added essential products and services—from food to protective gear to mobile banking, recognizing that our customers trust us and want us to deliver all solutions to them through our platform.”

  

Lead Investor Anne Chassagnette, Managing Director of ENGIE Rassembleurs d’Energies’s commented, “

 

“The swift adjustment of Frontier Markets’ organization to the COVID-19 crisis and its ability to leverage its innovative tech platform to address the essential needs of the rural population on short notice confirm our full support and our trust in its trailblazing business model.”

By 2025, the company plans to grow to one million rural women entrepreneurs serving 100 million consumers with all types of products and services relating to agriculture, insurance and environment to drive economic empowerment in Bharat India.

 

“Post-COVID, what was “socially good” has now become essential and urgent – Frontier Markets is leveraging upon the untapped opportunity of 900 million rural consumers through rapid expansion of its technology platform and its network of digitally enabled women micro entrepreneurs,” remarked Virginia Tan, Founding Partner, Teja Ventures.

(Edited by Aparajita Saxena)

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Original Source: yourstory.com

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Screenshot 2019 11 08 at 14.29.14Disruptive digital-only banks, innovative regulations, and shifting consumer demands have made today’s banking digital-first — but the benefits of digitization are being held back by identity verification challenges.

Identity verification underlies many of the core processes associated with financial services, with banks required to subject their customers to strict identity checks, both to protect those users’ finances and to meet regulatory compliance demands.

There have been a plethora of efforts aimed at streamlining identity verification online, but these attempts have largely failed to address the issue in its entirety. For example, customers are often required to create unwieldy passwords and verification details that can be difficult to keep track of to access their accounts. Not only have these efforts created new points of friction for users, but they’re also expensive for banks, with each password reset costing up to $70 according to Forrester Research estimates.See the rest of the story at Business Insider

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Deutsche Bank is partnering with Google Cloud to use its cloud computing capabilitiesPaytm has agreed to acquire insurance firm Raheja QBE for $76 millionGig workers pose a huge revenue and brand image opportunity for banks

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The last decade has seen India become a breeding ground for several innovative startups in the field of finance, using technology to provide better solutions. The fintech sector has witnessed the emergence of multiple unicorns in hugely under-served areas such as payment technology, digital banking, lending and insurance, amongst others. Lower cost, technology-based delivery of financial services has helped the financial sector serve hundreds of millions of Indians in ways that the legacy system couldn’t.

featureThe journey so far

Take payments for example – while over 170 million Indians have bank accounts[1], it took the advent of debit cards two decades ago for them to get 24/7 access to their own money so they could make instant payments at stores and online. The original fintechs (long before the term became fashionable!) such as Visa helped banks deploy this technology. However, only a smaller number of cardholders ended up using their cards to shop, while the majority used them to get cash at ATMs, in part because they didn’t have enough places to use them at. Hence the next big wave happened as fintechs started enabling more merchants to accept cards in their stores and others helped create digital acceptance for utility service providers and merchants.

Another game changer movement was the government’s commencement of the National Mission for Financial Inclusion (NMFI) in late 2014 to provide universal banking services to every household through mobile and biometric identification. While it has brought over 35 crore people into the formal banking system[2], with deposits exceeding over Rs 96,000 crore, according to the Department of Financial Services, it has also enabled collaboration between banks, fintechs and payment networks. This led to the growth of prepaid payment instruments in October 2017[3] and enabled customers to use their debit cards or bank accounts to load money into their wallets and use the now ubiquitous mobile phone to make payments easily.

Now as we move towards interoperable, open-loop payment platforms, where card credentials can be securely linked with a payment platform, we will see a convergence between the legacy financial systems and fintechs enabling instant and secure payments in-store or online. While the card acceptance infrastructure doubled in two years post demonetisation, there is tremendous potential to scale-up further on the back of technology. This will enable us to increase digital acceptance beyond the current estimated 10-15 million merchants, given that there are an estimated 1 billion+ digital payment credentials between card credentials (or card numbers) and UPI handles. The expansion of digital access is a major boost for financial inclusion as more Indians can now choose to pay, and be paid, wherever and whenever, digitally. This growth in the fintech space would not have been possible without collaborating with banks and payment networks and the rising internet and smartphone penetration, expected to reach 60% of country’s population by 2022[4].

That said, India is still far from its goal of achieving financial inclusion.

The roadblocks

As per the latest World Bank report[5], 190 million Indians remain without a bank account. For the accounts that do exist, around 48 percent are inactive. In conjunction with that, several financial institutions have so far focused on catering to the needs of metros and mini-metros, leaving out most of the population of India. Hence with the problem not limited to individuals but also businesses, the reliance on banks or digital payments to conduct transactions is marginal.

While demographic roadblocks such as language barriers have restricted proliferation of digital payments among specific groups, the diverse linguistic landscape has also not allowed players to deploy products in all or several of these languages. Moreover the high cost of deploying infrastructure to bring in more people on board has also led to low issuance and penetration of payment instruments.

The problem of high infrastructure cost is prevalent among merchants with only 7-10 percent of the approximately seven crore traders at present having adopted digital mode of payments[6]. While it leaves a huge opportunity for expansion, it also provides a collaboration opportunity to different entities in this sector. This collaboration between big players and new-age fintech firms will help in building synergies and ensure that both are complementary to each other. Fintechs that usually aim to introduce convenient, simple and affordable solutions to consumers and businesses alike will benefit.

Riding the next wave

Fintech players have already experienced a head start in driving the next wave of financial inclusion in India by offering digital technologies. Besides, the regulatory support from the Reserve Bank of India (RBI) through guidelines on tokenization, account aggregation and the regulatory sandbox environment has further helped the cause. Against this backdrop, fintech players are looking to leverage low cost, asset-light infrastructure to roll out innovative services that target last mile penetration – such as Bharat QR or contactless ‘tap-to-phone’ on mobile to ensure simple, secure, and convenient ways to pay. They have understood that there can be no one-solution-fits-all approach.

For instance, firms engaged in providing wallets, offering payment gateways and neo-banking, among others have all rolled out tailored financial products that could cater to unbanked and underserved customers. In the field of lending too, fintechs have come up with several kinds of initiatives, such as micro lending and marketplaces to sell loans to end-users. These wallet players have also diversified their businesses and morphed into payment platforms that now enable P2P (person to person) and P2M (person to merchant) transactions using wallets, UPI and cards. Solutions such as Visa Safe Click reduce friction and enhance the ecommerce experience of consumers for smaller transactions in a secure manner.

The road ahead

Fintech players have set the ball rolling for the country to reach its complete financial inclusion goal. A collaborative approach is the natural next step to accelerate the pace of this process. Cooperation between governments, executive bodies, regulators and private businesses is a prerequisite, but the collaboration within the industry — between established financial institutions and emerging fintechs – is also a key aspect. Both are naturally interdependent and synergistic in nature. This ensures that the financial burden of setting up physical infrastructure or building networks does not solely lie on fintechs. Instead, they could channel funds to develop their core business and use the strengths of existing players to provide better solutions to the market.

Take the emerging concept of enabling mobile phones to make and receive payments – fintechs are actively developing technology that banks may embed in their mobile apps, to enable their merchants to receive payments on their own phones. Meanwhile, large big techs such as Google are enabling customers to provision tokenized card credentials into NFC enabled mobiles, helping customers tap their phones to make a payment, using cards issued by the banks.

As the industry starts tightening its expenses and investments in a world post-COVID, fintechs will be a catalyst to faster digitisation and hence financial inclusion. As a leader in payment technology, Visa is committed to partnering with emerging fintechs to expand digital payments by uplifting and creating a platform for them. Through the launch of programs such as the Visa Everywhere Initiative (VEI) and Fintech Fastrack program we’re creating an ecosystem for fintechs to enhance their product proposition and provide visionary solutions through our vast network of partners.

Shailesh Paul is Head of Merchant Sales & Solutions and CyberSource, India & South Asia, Visa

[1]Global Findex 2017: World Bank Group

[2]Data From Department of Financial Services

[3]Master Direction on Issuance and Operation of Prepaid Payment Instruments: RBI

[4]Cisco Annual Internet Report (2018–2023) White Paper

[5]Global Findex Database 2017

[6]Modi Government Plans To Assist Small Retailers To Digitise Operations

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Original Source: yourstory.com

Banking and finance plays an essential role in driving the growth of the Indian economy. In the past few years, we have seen the rise of fintechs and digital wallets, which has led to a massive increase in the financial inclusion of the Indian population, especially in rural areas.

To prevent fraud and money laundering, the BFSI sector needs to comply with KYC norms that were introduced by RBI and are based on the Government of India’s (GOI) PMLA Law of 2002.

Aadhaar-based KYC verification had simplified the process and reduced the time taken by the BFSI sector to on-board customers drastically. But, things changed with the Supreme Court order dated September 26, 2018, declaring the use of Aadhaar-based KYC by private players as unconstitutional.

To overcome this challenge, RBI has introduced Video KYC as an alternate tech-driven mode of KYC in its notification dated January 9, 2020. It is based on the Aadhaar and Other Laws (Amendment) Bill, 2019, which was introduced by the government on June 24, 2019.

video kyc

The RBI amendments state that “with a view to leveraging the digital channels for Customer Identification Process (CIP) by Regulated Entities (REs), the Reserve Bank has decided to permit Video-based Customer Identification Process (V-CIP) as a consent-based alternate method of establishing the customer’s identity, for customer on-boarding”.

Also ReadBanks can use Aadhaar for KYC with customer's consent: RBI

Contactless on-boarding during COVID-19

Video KYC could prove to be a tremendous boost for private and public banks, lending companies, prepaid wallet players, insurance, financial securities, and non-banking financial institutions. They are now looking for a contactless and paperless customer on-boarding process while still being 100 percent compliant with RBI guidelines.

The Video KYC provision allows bank officials or regulated entities (RE) to remotely verify the customer’s identity using Aadhaar or PAN card. To ensure the integrity of the Video KYC process, RBI encourages REs to adopt AI-driven and face-matching technologies.

However, there are certain guidelines laid by RBI to comply with before initiating this process. The audio-visual interaction is triggered by RE’s domain, and the Video-Based Customer Identification Process (V-CIP) shall then be operated by the officials that are specifically trained for it.

This could significantly reduce the time from a five to seven-day process to three minutes to on-board a customer remotely. It will allow BFSIs, NBFCs, and e-wallets to provide superior customer experience and will reduce on-boarding costs by 90 percent.

Beyond compliance: a competitive differentiator

While Video KYC has enabled banks to ensure compliance with remote on-boarding, customer drop-offs remain the biggest challenge.

To complete the Video KYC process successfully, customers need to have their Aadhaar, PAN card, and other documents to verify the signature handy. It needs a pre-scheduled time and many times banks would need to chase customers to get this KYC interview to happen.

This then becomes an important step in the on-boarding journey and needs to be looked like a sales funnel.

To ensure higher video KYC completion rates, BFSI companies need to put the effort into reminding and scheduling the video KYC recording at the customer’s convenience. Experience would be key here.

Banking and finance companies that can make this process hassle-free for users have the highest chance to reduce drop-offs and on-board more customers.

Let’s say, for example, a bank ABC uses only outbound calls to remind customers to complete their KYC. Another bank DEF uses other non-intrusive channels, like SMS or WhatsApp, to remind customers and even allows them to reschedule KYC recording on the go.

DEF bank gives the control of KYC completion to the customer who can complete the process at his convenience rather than just getting interrupted by a voice reminder of bank ABC.

This superior customer experience can become a competitive advantage for banking and finance companies to acquire more customers and gain a higher market share.

Future of video KYC

Video KYC is here to stay and will become the de facto choice of customer identification.

We see many tech investments happening in this space to make the system more robust and ensure the integrity of the video KYC process.

Some of these are

AI-based face recognitionEnsuring good video quality for low networksVideo compression to reduce storage space requirement while ensuring integrityFraud and spoofing attack preventionScreen sharing for Aadhaar offline KYCConcurrent audits to fast-track the processAutomated omnichannel reminders and schedulers

The acceleration towards digital adoption in the banking and finance sector is expected to rise with the introduction of video-based digital KYC.

While the banking and finance sector has been discussing digital transformation for long, COVID-19 has left them with no option but to implement it. Many of them have started using alternate modes of engagement like WhatsApp and IVR. Video KYC is also enabling them to manage compliance requirements.

The BFSI sector can integrate video KYC as part of the customer journey workflow to on-board customers digitally while still ensuring compliance with RBI guidelines.

(Edited by Teja Lele Desai)

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)

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Original Source: yourstory.com

With the COVID-19 pandemic disrupting businesses globally, technology will play a "stronger role than ever before", enabling economic recovery, Microsoft India President Anant Maheshwari said.

Speaking at the Microsoft Envision Forum 2020, Maheshwari noted that the coronavirus pandemic has changed businesses, communities, industries, and the world, forever.

"No one company is going to solve a challenge like this alone, and it is going to take the private and public sectors working together to turn the tide on COVID-19. As we continue to work through the current situation and plan for the future, it's clear that the change required is significant – as is the potential opportunity across industries," he said.Microsoft Brings Defender Antivirus for LinuxAlso Read9,100 coronavirus-themed cyberattacks in India between Feb 2-May 2: Microsoft

He added that technology will play a key role in management of social sector programmes across education, health and public distribution, helping to strengthen the economy.

"Technology will play a stronger role than ever before – enabling economic recovery and helping each one of us achieve more," he emphasised.

The event, which was organised digitally on Friday, saw industry leaders across banking, financial services and insurance, manufacturing and retail sectors deliberate on the need for innovation and real-world digital transformation.

Aarthi Subramanian, Group Chief Digital Officer at Tata Sons, said COVID-19 will accelerate the scaling of digital across industries and investments in cloud, artificial intelligence and cybersecurity.

"Digital transformation in companies will focus on new end-to-end customer journeys and we will see an increase in adoption of automation in manufacturing industries. They will also invest in enhancing employee engagement given the remote working model," she added.

In another development, reported by a Microsoft executive, it was found that cybercrooks are using COVID-19 to make ransomware and phishing attacks on people.

"Between February 2 and May 2, we saw 9,100 total file encounters related to COVID-19 or coronavirus. It means our detection tools actually saw malware, URL, an attachment, or a phishing email using COVID-19 as a lure to get somebody to download malware to the system or potentially to give up their credentials via a phishing attack," Microsoft Corp Corporate Vice President (Cybersecurity Solutions Group) Ann Johnson told reporters on a conference call.

(Disclaimer: Additional background information has been added to this PTI copy for context)

(Edited by Kanishk Singh)

How has the coronavirus outbreak disrupted your life? And how are you dealing with it? Write to us or send us a video with subject line 'Coronavirus Disruption' to [email protected]

Original Source: yourstory.com

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