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Google-backed Open plans to involve 10 million small businesses over three years

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Open, a neo-bank backed by Google and Tiger Global, plans to reach around 10 million small businesses over three years. It aims to use technology to solve the set of challenges small businesses face to manage their business finances.

Open partners with banks to offer business accounts that help small businesses automate their finances and operate effectively. Partnered with the top 14 banks in India, the company aims to join around 250 banks globally using its platform and technology. We plan to expand our business globally in markets such as Europe, Southeast Asia, and the Middle East.

Anish Achuthan, co-founder and CEO of Open, said: interview. “Today, many large banks in the country are deploying our solution to launch their own neo-banks.”

For example, the company’s BankingStack solution enables banks and financial institutions to launch digital banking services. It is deployed in over 15 banks in India and 2 banks in Southeast Asia. This will allow banks to complement their own digital banking offerings and provide a superior experience for their customers.

Achuthan said:

Open competes with players such as Razorpay and UK fintech companies such as Revolut and Tide.

Open recently became India’s 100th unicorn after raising $100 million in a round led by Temasek, Google and SBI Investments. It currently serves over 2.3 million small businesses and processes $30 billion in transactions annually. The platform employs 100,000 new small businesses and startups every month.

The platform enables businesses to collect payments, make payments seamlessly, and streamline expense management. Other processes include managing compliance, auto-reconciliation, and classification of income and expenses, thereby automating bookkeeping.

“We are currently managing $2 billion worth of deposits on our platform. We aim to bring this to around $7 billion by next year,” said Achuthan.

Open was founded in 2017 by serial fintech entrepreneurs Anish Achuthan and Mabel Chacko, along with Ajeesh Achuthan and Deena Jacob.

As a natural progression, Open is now tapping into the small business lending space as well. Apart from the existing His SME credit card offering, the platform is gearing up to launch three new products aimed at boosting the capital needs of SMEs. New products include Open Flo, a revenue-based lending product for e-commerce businesses, Open Settl, an early settlement credit offering, and Open Capital, a working capital lending offering for small businesses.

Open aims to make $1 billion in loans over the next 12 months through a new suite of products on its platform.

The Open and IIFL Finance Ltd. have launched a joint venture to launch a neo-bank to serve the banking and credit requirements of Micro and Small Enterprises (MSMEs). Offer an alternative experience to traditional banking. This includes providing a simple interface for banking and seamless integration with accounting, finance and payroll.

Mr Achuthan said lending to SMEs is necessary as they largely lack access to strong capital resources. According to his recent IFC report, small businesses account for just 6-7% of his credit share and face a credit gap of nearly $1.1 trillion.

The company recently received the go-ahead from the Reserve Bank of India (RBI) for a new cross-border payment product. This comes after Open completed the testing phase of his second cohort under his RBI’s regulatory sandbox structure on the theme of “cross-border payments.” Open is one of his four entities to complete the testing phase of RBI’s regulatory sandbox.

Open also developed “Zwitch”, a no-code embedded financial platform. It enables businesses in all industries to build personalized financial products and services that fit the customer journey.