A Tale of Two Cities begins with the now immortal lines: it was the best of times, it was the worst of times. If Charles Dickens wrote about the Indian fintech ecosystem today, we think it would be eerily similar, something like:
“It was the best of times, it was the worst of times,
it was the age of unicorns, it was the age of funding freeze,
it was the epoch of BNPL, it was the epoch of no FLDG,
it was the season of UPI, it was the season of zero MDR,
it was the spring of CBDCs, it was the winter of cryptocurrencies,
we had everything before us, we had nothing before us…”
2022 has been a tumultuous year for Indian fintech. We recently got our hands on a fintech entrepreneur’s diary describing its highs and lows. Here’s a glimpse at how she’s been navigating business opportunities and regulatory curveballs with her trusted advisor, Cecil, by her side.
Dear Diary,
We’re now among the top five most downloaded fintech apps in India. Our marketing campaign was a hit, and it seems cashbacks and influencer promotions did the trick. Nonetheless, it wasn’t smooth sailing. The tech team struggled to keep up with the surge in users and the app crashed. Luckily, we were able to get it up and running within the hour.
Dear Diary,
The pitch-deck is finally done. I was chasing my tail on the monetisation model. After several hours of brainstorming with Cecil, I added a few more slides on using payments data to cross-sell credit products – our core monetisation strategy. Fingers crossed.
Dear Diary,
We’ve been funded! Cecil and I jumped unabashedly on our couch, I must admit. I posted on LinkedIn about the fund-raise after running the post by Cecil. He thought it had the right mix of humility and aplomb for a newly funded fintech start-up – ‘humble brag’ as the kids call it.
Dear Diary,
The investors asked us to tighten our KYC process. They’ve been spooked by the Dhani identity thefts. I’m wary of adding friction to the customer journey. But as Cecil reminded me, it’s a tradeoff between user convenience and security; and the latter, in fintech, always wins. I also watched the Netflix series on the Wirecard scandal. Scary stuff.
Dear Diary,
We received an offer to partner with a crypto exchange. Cecil and I are still bullish on crypto. Like Elon, Cecil’s favorite crypto is Doge. But our partner bank and payment aggregator vetoed the proposal. Sigh.
Dear Diary,
I’m tired. I woke up with a terrible hangover after Cecil’s birthday party. And if that wasn’t enough, our partner bank called to discuss our co-branded card. They’re reluctant to share transaction data with us anymore because the guidelines bar it. Our lawyers, bless them, found a loophole.
Dear Diary,
RBI banned credit-loading PPIs. Cecil and I had gone for a run. When we returned, I saw half a dozen missed calls from our legal team. That’s never a good sign. We were going to launch a credit-loaded PPI. Not anymore.
Dear Diary,
The digital lending guidelines dropped. Much has changed. It’s another reminder that the RBI holds the kill switch. I want to minimize disruption to our existing customers that we’ve paid dearly to acquire. Cecil’s been a rock – a voice of reason and calm. This too shall pass.
Dear Diary,
I’m in Bombay for this glitzy fintech event. The who’s-who of the fintech verse are here. There’s a lot of fist-bumping and chest-thumping on stage. But behind the scenes, the mood is sombre. I find these events tedious. I’d much rather spend my day tinkering with our app, discussing new ideas with Cecil, or talking to users. Alas.
Dear Diary,
It’s the last day to purge card data. We thought RBI would relent. It didn’t. Our payment aggregator said they’re prepared for tokenization. Cecil tells me to trust them. And that’s what I’ll do because that’s all I can do.
Dear Diary,
I woke up today without Cecil slobbering all over me – never a good sign. So I took him to the vet, which he hated, plus it took all day. My start-up can wait, Cecil is my priority.
Wishing Cecil a speedy recovery.
(This post has been authored by the fintech team at Ikigai Law. It was originally published in the October 2022 edition of our monthly fintech newsletter, FinTales.)
