In conversation with Mr. Fahim Saiyed, Chief Business Officer, RING as he talks about the evolving merchants from small towns and how fintechs are driving financial inclusion of the unorganized sector in India
· Briefly introduce RING & highlight your role in the organization?
RING is an online instant credit platform that caters to millennials across Tier 2- 6 cities and those without access to traditional lines of credit. It is yet another disruptive product offering from the founders of Kissht that has made an impact over the last 6 months. RING customers can avail a credit of up to INR 50,000 for eCommerce transactions, bill payments, paying merchants offline, and transfer money to friends or themselves.
I am the Chief Business Officer and am largely responsible for growing the merchant community on RING. Identifying potential markets, sorting credible pool of merchants and their onboarding to working closely with them to turn them into advocates of the brand, is the responsibility of my team. We acquire nearly 40% of our new consumer base through our merchants, thus they are very important aspect of our overall growth strategy.
· Broadly define the merchant profile of RING. How many merchants do you plan to onboard by the end if the FY?
We work with the merchant community who have a steady business, like shopkeepers, vendors, blue collared class, etc. we call them the ‘organized class in the unorganized retail sector’. As our merchant community expansion plan, we will reach out to bigger merchants like wholesalers, retail chains, etc. RING has partnered with close to 5 Lakh merchants and hope to end this financial year with a 10 lakh merchant base.
· Which are your strong merchant cluster markets?
We are happy that RING has market presence across all the major cities in the country. Since we are headquartered in Mumbai, we have a stronghold in the West region, followed by North and South. The presence in Northeast and eastern markets are comparatively limited but we have a solid plan of entering those markets, too.
· How can a Brick-and-Mortar store in rural India benefit from using a digital payment app?
Traditionally, the brick-n-mortar stores in rural areas or small towns did not have access to traditional lines of credit and they rely on local loan sharks or dubious money schemes, for their financial needs. Most of these loans they take have huge interest rates and are never formally accounted, thus they never create a credible credit history. Now with the entry of fintech players, these merchants are able to secure instant loan and the timely repayment of these loans and repeated transactions will help them build their CIBIL credit score. This eventually makes them eligible for larger loans from traditional channels, in future. More importantly they become part of the formal credit economic ecosystem, and thus their growth contributes to the overall economic growth of the country. By using the digital payment apps, these merchants also enjoy the perks of discounts, cashbacks, loyalty points and additional benefits from incentives, which potentially could be an added source of income. Post the pandemic, most businesses have moved digital and fintechs operating with the small income groups who are new-to-digital, are helping them transition their business from physical to digital or hybrid mode.
· With smartphone & internet penetration, merchants across small towns also are digital savvy. How has interaction changed with these evolving merchants 2.0?
The easy accessibility to the internet and smartphone penetration in to the hinterlands of the country has definitely helped improve the digital literacy of the mases. The local community is consuming latest trends and best practices via the internet and are becoming more aware of the evolving socio-economic ecosystem. Masses are reasonably comfortable with digital transactions and are open to exploring other credible apps which brings convenience an ease to their lifestyle. The merchants 2.0 are aspirational and willing to adapt to the change and move away from the traditional norms and embrace the digital transformation.
· Key initiatives by RING to promote the brand and connect with the merchant community?
There are two ways RING reaches out to new consumers, one is by enticing downloads from the Appstore and the other is where we onboard merchants and they advocate our brand to their local customers. The merchants bring in nearly 60% of our new customer base and hence they are a big focus for our growth strategy. We have innovative and immensely rewarding schemes and incentives for our merchant community, through our RING club program. We have designed a holistic program which not only offers incentives for business but also is a platform for merchants to engage, interact and seek guidance. We want to be an integral part of the merchant’s growth story. In addition, we also collaborate with micro-influencers, push branded content engage our consumers with interesting brand activities and most importantly use our digital reach to celebrate the success stories of our merchant tribe.
· Tell us more about the RING club program?
RING Club, is a one of its kind loyalty program for top-performing merchant partners Merchants who become a part of the exclusive RING Club will have access to a variety of special benefits and incentives. RING Club members will be awarded with certificates, bouquets, loyalty points and additional benefits apart from incentives such as invites to yearly events at exotic holiday locations in the country. Other benefits of RING club membership for top performing merchants include branding at the store, access to a dedicated helpline and SPOC, assistance to avail credit cards to meet their emergency fund requirements etc. The RING Club program is helping us to aggressively increase our merchant base by leaps and bounds every day across the length and breadth of India.
· How is the merchant network contributing to financial inclusivity in rural India?
As mentioned, a large chunk of our customer base comes from the merchants, so they are the catalyst driving the transition of a cash-driven culture into an online-transaction culture. Tier 3-4 and small towns are the potential hub for business and with the growing digital literacy of the masses, the adoption of digital practices is gaining momentum. In remote areas and difficult terrains, the local vendors, small merchants collaborating with the fintechs or using apps for financial transactions essentially act as an intermediatory for the unbanked population who might not be part of the formal credit line. So, they are playing a big role in creating the last mile accessibility for financial inclusion. The success of financial inclusion largely rests on the merchant community’s ability to shift local population from cash to digital payments economy