Exclusive | Simpl eyes partnerships with banks, NBFCs

Nityanand Sharma, CEO, Simpl

Buy-now-pay-later (BNPL) fintech Simpl is looking to partner with banks and aiming to reach 150 million customers by 2024, said Nityanand Sharma, its Chief Executive Officer (CEO). The fintech is also hopeful of increasing its merchant base from the existing 26,000 to 1 lakh in two years, Sharma said.

The apex bank, in mid 2022 brought in regulatory restrictions for BNPL players, which led to massive changes in the industry.

Simpl, a BNPL fintech specializing in one-tap checkout service, is targeting to expand its operations and hopeful for the larger BNPL sector to bloom.

“In 2023, the fintech industry will see disruptive business models delivering customer-centric solutions at very low costs,” Sharma said.

In an exclusive interview with Moneycontrol, Sharma spoke about Simpl’s plans to align with the new regulatory measures, trends in the fintech industry, changes in the business model of BNPL fintechs, and more.

Edited excerpts.

How would you look at Simpl’s business in 2022?

We recorded 42 million users on our platform in 2022 and onboarded 19,000 merchants, taking the total number of merchants to 26,000. The checkout category, we believe, will grow exponentially over the next decade,and our easy-to-use shopping experience helped in our overall growth. In addition to doubling the frequency of orders, Simpl has raised average order volume by 20–40 percent.

The regulator brought in new measures for BNPL fintechs in 2022. How do you view these changes?

The year 2022 was about regulators giving the industry a lot of clarity about the approach and principles behind BNPL fintechs’ actions. The new regulatory measures will lead to a better ecosystem that will always keep customers and customer protection at the heart of fintech business models and respect the systematic nature of risk in the financial system.

Other than this, the most important lesson out of the regulatory actions for fintechs is to build a business with long-term sustainable unit economics.

How do you see 2023 playing out for fintech players? Do you see any trend in the making?

The fintech sector is in a unique decade of mature technologies. Artificial intelligence (AI) is just getting to an inflection point. We think 2023 will see disruptive business models delivering customer-centric solutions at very low costs, which will lead to the widespread penetration of financial services and digital payments.

In line with these innovations, we are reimagining how online payments can seamlessly enhance the overall consumer experience. We are working on enabling zero-friction e-commerce experiences by building new sets of merchants and consumer-facing products.

What are your thoughts on the Union Budget? Did it do justice to the large financial and fintech sector?

Announcements such as the extension of the date of incorporation for income tax benefits to start-ups, and the provision of providing the benefit of carry forward of losses on change of shareholding of start-ups are good moves for the industry.

The deduction of 39,000 compliances and decriminalisation of over 3,400 legal provisions will help fintechs at large. Such steps will play an instrumental role in ensuring ease of doing business in the country.

Talking about Simpl, what plans do you have in place for 2023?

We are looking to expand to 150 million users by 2024 and are aiming to increase the merchant base from 26,000 to 1 lakh.

One thing we have noticed is that there is scope for networking outside of metropolises in India and we are yet to look outside the major cities in our quest to become the new Visa for clever e-commerce. With AI and machine learning (ML), we are also constantly enhancing our models for credit decisioning and fraud detection.

How do you see growth in the MSME and enterprise segments?

We are at the point of the technology life cycle where most consumers globally have democratic access to internet technologies and internet-enabled services. With this, we believe that the next few years would bring opportunities and growth for MSMEs and enterprises for fintech players.

Are partnerships with banks on the anvil for Simpl?

Yes. We are planning to build an open ecosystem to provide a great user experience (UX) to consumers and business-growing tools to retailers. In line with this, we see partnerships working with banks and other financial services companies