Over 82 percent of small businesses have been negatively impacted by the pandemic lockdowns. 70 percent believe it will take them nearly a year to recover demand levels prior to COVID-19. More than half of them believe adopting technology will help them bounce back faster. This calls for solutions, which are specifically designed for Kirana businesses, assist store owners in increasing store walk-ins, streamlining business operations, increasing sales, and much more. An urgent essential is a platform that integrates and links all of the ecosystem's main stakeholders while also streamlining financial operations.
Bridging the Gap
Embedded finance eliminates the need for a third-party bank or lender. Embedded financial organizations have discovered a way to operate as a link between themselves and their customers. Some apps allow users to order and pay for items directly from their phones. It also gives them reward points that can be used to make future purchases.
Secure Payment in a Few Taps
90 percent of the FMCG business is done through Kirana stores in India. Digitizing payments is the need of the hour during the new normal. Embedded finance is intended to be virtually invisible to end-users in areas such as payments, lending, and beyond. It enhances simplicity and usability while generating additional revenue streams for businesses. Customers can buy almost instantly with embedded payments. A user utilizing an app with an inbuilt payment program doesn't have to go through their wallet for cash or find their credit card, instead, they simply hit a few buttons and the payment is done.
Savior During COVID-19
Because emerging nations have lower levels of financial inclusion and financial depth, they stand to benefit more than advanced economies. The moment has come to fully invest in developing digital business models in order to aid the wider economy in recovering from the COVID crisis. With embedded payments, contact is minimized and both vendors and buyers can be safe while purchasing essentials.
Survival of the Fittest
The harsh reality is that the financial services industry hasn't altered its primary business model in centuries, and the pressure to do so is considerably greater now than before COVID. Financial institutions need to adapt and survive to position themselves in the value chain. This can only be done by embracing the open economy, incentivizing customers to maintain their primary relationship by means of integrating services beyond banking, and building partnerships like embedded finance that cover product or service gaps.
Frictionless Interactions - Embedded finance features open data. The relationship between the Point-of-Sale (POS) and financial institutions involved are transparent. Open-data ecosystems make it easier for financial institutions and micro, small, and medium-sized businesses to connect without friction, providing value for both parties. The need of the hour is an ecosystem that can improve access to financial services, user convenience, and product and service options for customers. Improvements in operational efficiency, fraud prediction, workforce allocation, and data intermediation friction for financial institutions are also widely sought after
Increased Revenue - Until recently, if a company wanted to provide financial services, it had to develop its own FinTech division. It necessitates enormous investment, takes years to construct, and even longer to become viable. An effective fin-tech service provider embeds finance infrastructure lowers the bar for digital platforms to offer financial services to their clients natively. Businesses see an increase in revenue as their average order value (AOV) and client retention increase.
Get Access to Valuable Insights - Offering embedded payment uncovers significant information on customers and their habits, which can be used in innovative ways. This offers insights on what products are highly popular. This can be used to keep inventory stocked. There will be no missed sales due to out-of-stock reasons.
Value-Added Services - Embedded finance simplifies the process of paying for products or services for the end-user while also allowing access to value-added services such as rewards, discounts, or new items. Meanwhile, it creates prospects for enhanced loyalty and possibly new revenue streams for brands and businesses.
In a country of 1.3 billion people, a network of over 10 million Kiranas are part of the national infrastructure of customer service. These consumers have a median basket size of less than Rs 200 and shop even up to 3 to 5 times/week. The survival of these small businesses is a direct narrative of the survival of a distribution system that serves the needs of a large population. Leading this narrative is SnapBizz, the Fin-Service platform assisting the retailers with technology enabling digital store management to transform their stores into smart stores, delivering financial inclusion, and integrating them with all the stakeholders of this ecosystem. We believe this initiative will help Kiranas not only survive but also thrive.