DAILY VOICE | Women are actively looking at stock market, both via direct investments and MFs: Hena Mehta

Hena Mehta, who has an MBA from The Wharton School, and a Computer Science Engineering degree from the University of Pennsylvania has over a decade of experience in the FinTech industry which was instrumental in starting ‘Basis’ to empowering women in taking financial decisions.

Mehta is co-founder and CEO of Basis.

With Basis, financial services is finally speaking to millions of Indian women, who are changing their financial behaviour and, in turn, changing their lives for the better, all at their fingertips on the phone, she said in an interview with Moneycontrol’s Kshitij Anand.

Edited excerpts:

Q) This is a unique concept and a relevant one in this time and age as well? What is the kind of change you have seen over a period of time with respect to how women are now approaching their finances?

Related stories

Hena Mehta

Co-Founder & CEO|Basis

A) Yes, this is a unique concept, and highly relevant now with relevancy only set to increase in the years to come. General social trends indicate that women are looking for options to be independent: financially and otherwise.

Women are choosing to live independently, prioritising income generation, choosing to delay marriage, and starting more enterprises.

As part of our journey researching the space, we’ve seen that incumbents are failing to cater to the unique financial needs of women.

Even though there is a strong intent to save and invest money, and make financial decisions independently - women tend to get left out of financial services.

With Basis, we are turning these latent users into active, informed customers - thereby growing the pie for financial services overall.

Q) How are you enabling financial independence for women through engaged communities?

A) Our engaged communities are core to the Basis offering. By being part of cohesive communities that are supportive spaces to voice queries and share learnings, women are able to overcome the trust gap that is often a barrier to acting on money-related decisions.

We’ve seen women be actively engaged in our communities and community activities. From “how do I negotiate for better pay at work?”, to “what’s a good maternity insurance plan?” - we see money discussions across a spectrum of topics.

Our communities also have experts: financial advisors, CAs, HR leaders, lawyers, seasoned entrepreneurs, etc. that assist with queries and drive discussions - so we ensure quality and accuracy of the advice that women are receiving.

With Basis, financial services is finally speaking to millions of Indian women, who are changing their financial behaviours and, in turn, changing their lives for the better, all at their fingertips on the phone.

Other than communities, the viral mobile app of Basis features:

(1) The Knowledge Boosters came out of the need for jargon-free information that was relevant to women, so a woman doesn’t have to sift through scores of dense and overwhelming information to arrive at what she wanted.

(2) The Advisory Section offers tools and recommendations to manage money better. Right from suggesting mutual funds based on the user’s financial goals, to insightful calculators that estimate corpuses for events like a career break (all powered by an in-house set of algorithms), the team at Basis is building for a woman’s financial requirements at every life stage.

Q) Which is a more popular route for investment — stock trading or mutual funds or both? I ask this because data from various brokerage houses suggest that Women traders are growing and especially during the COVID times?

A) Previously choosing traditional avenues such as recurring deposits, term deposits, post office saving schemes, and gold, women are now realising that the returns on these investments have lost sheen.

Women were seeking fixed returns and now with the change in the job market and salary cuts, the realisation is that for the next few years at least income increases via salary hikes are not going to be great.

In the absence of hikes, and the returns on traditional investments going down, the stock market both via direct investments and mutual funds is seeing a spike.

Inflation was not talked about enough, and encouraging conversations around these topics has piqued interest in investments whose returns at the least meet inflation rates.

Our community while dipping their toes into stocks, is more likely to invest in mutual funds considering the risk that is mitigated by the experience of the fund manager.

Women are also more aware of the fact that equity is not the only option via mutual funds - and debt funds whether short-term or long-term can replace their FDs in some ways.

Trading needs to be accompanied by learning, otherwise, we are going to see the same investors exit and avoid the market should things go south.

Some of these ramifications are avoided by mutual funds. A combination of stocks and mutual funds, with a higher allocation to funds is what we have noticed.

Q) You are a budding startup —- what are your future plans?

A) We’re building India’s first digital financial services brand for women, anchored in education and communities. Our vision is to be the one-stop financial destination for all things women and money (a multi-billion dollar market).

We’re looking forward to partnering with financial services companies to offer curated services and products that are tailored to women’s lives.

We also have ambitions to go international, as the pain points and gaps we are addressing are global issues.

Q) What is the Basis investment strategy?

A) Our investment strategy is centered around building a long-term investment discipline rather than aiming to beat a certain market benchmark.

● Emphasis on asset allocation and diversification as a priority over mutual fund selection.
● Based on proponents of modern portfolio theory.
● We analyze over five years of data to suggest appropriate allocations into funds tailored to meet our customers' financial goals.
● We run over 2000 simulations, to ensure that the recommendations are best suited to succeed in real world conditions
● Risk assumptions might vary from the traditional asset allocations associated with certain risk profiles. We surveyed over 500 women before putting our risk profiles in place. For instance even in our high growth (otherwise a 100% equity allocation) we consider hybrid and debt as small parts of the portfolio to provide cushion and agility in the portfolio. Women are more agile in changing markets and this has played an important role in our investment strategy.

Q) Tell us something about Basis First?

A) Basis First is our premium subscription plan that we will be launching next quarter.  Through Basis First, we are offering personalised financial advice, along with premium content, community events and workshops for our members.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.