In 2006, with the introduction of mobile wallets, PayMate became a pioneer in the India’s payments space. But soon, due to regulatory hurdles it made a quick pivot to the B2B model, solving payments for large enterprises and SMEs. Today, backed by a string of notable investors like Lightbox Ventures and Mayfield Fund, the company has registered 20,000+ businesses on its platform and reached US $3 billion in annualized GPV. Its game plan is to reach 75,000 customers by the end of the current fiscal and close the year at a runrate of US $3.5 billion in processing volumes.
The evolution of the payment space on the consumer side is evident for all to see. However, the world of business has been relatively slow on the digital payment uptake so far. With the new GST regime in place, the financial transaction for this community is likely to transition into a new era. Fintechstartups have identified this opportunity and are looking at providing innovative solutions for payments and transactions enablement in the business environment. One such company is Mumbai-based PayMate India, founded by Ajay Adiseshann and Probir Roy in 2006.
Moving From B2C to B2B
When the entrepreneur duo set up PayMate, the idea then was to increase the mobile subscriber base and create a telecom revolution. “We wanted to facilitate person-to-person payments and as a natural extension, merchant payments on all mobile platforms. I even have a granted patent in India for mobile payments,” reminisces Ajay. PayMate, a PCI-DSS compliant company launched a text-based wallet app that a user could top up and pay. The user just had to link his/her mobile phone to the bank account and have a seamless bank account and debit experience. Moreover, the app didn’t need data connectivity and it would be embedded into the user’s phone. “Back then, we were the first company to introduce this model. A little ahead of the economy, I can say, which opened up two years later,” he says.
However, being pioneers in this field came with its own challenges. “The regulators looked at what we were doing, and often they’d come up with various guidelines for mobile banking and wallets,” says Adiseshann. This slowed down the business and pushed them to look at alternative models. That’s when PayMate made the pivot to the B2B space.
In early 2011, the entrepreneurs found an opportunity to solve payments for corporates and car rental companies. “This was an attractive space to be in because there was economic sustainability and better opportunity for customer acquisition and retention,” admits Adiseshann. PayMate began developing solutions that catered to large enterprises and SMEs to help them on two fronts; to transition from traditionally slow and costly forms of payments like cash and cheques to real-time and efficient digital payments, and to enable customers to automate and seamlessly manage vendor and customer payments and cash flow. “Today, processing high volume transactions, payment settlements, risk mitigating, and security are core elements of our proprietary cloud-based platform. In fact, businesses can also apply for working capital finance,” explains the entrepreneur.
Since we were pioneers in the B2C mobile wallet space, the regulators introduced new guidelines which slowed us down. Building a network and acquiring consumers and merchants became a huge challenge. Hence, in 2011, we decided to pivot to the B2B model
PayMate’s 3-Year Game Plan
Funded by Silicon Valley-based VC firms like Kleiner Perkins Caufield & Byers (KPCB) and Sherpalo Ventures along with Mayfield Fund and Lightbox Ventures, PayMate has been growing at a 100 per cent CAGR in the last three years. It has crossed US $3 billion in annualized Gross Processing Volumes (GPV). This fiscal it aims to close the year at a runrate of US $3.5 billion in processing volumes.
The company recently acquired micro-lending institution Zaitech Technology (Z2P), with an aim of speeding up credit applications and the credit decision-making processes for small-medium enterprises (SMEs).With this acquisition, PayMate further plans to partner with banks and NBFCs to improve credit flow to SMEs. The company also recently forged a strategic partnership with Visa to enhance its payment services for corporate customers, achieve operational efficiency and enhance cost savings faster.
PayMate’s game plan in the next three years is to have a million small businesses on its platform. To achieve this target, it plans to scale across verticals specifically focussing on buyer-supplier ecosystem and deliver value from payment and lending. It also aims to increase its workforce from the current 80 employees to 250 employees in the next two to three years.
With over 20,000 registered businesses on its platform, PayMate is leading the way in providing a safe and efficient way for businesses to automate their account payables and accounts receivables, make real-time payments to vendors, and manage cash flow.
Founders: Ajay Adiseshann and Probir Roy
Year of Incorporation: 2006
Funding: Silicon Valley-based venture capital companies Kleiner Perkins Caufield & Byers (KPCB) and Sherpalo Ventures along with Mayfield Fund and Lightbox Ventures
PayMate offers electronic business to business (B2B) payment solutions for large enterprises and SMEs. It helps them on two fronts; it enables them to transition from traditionally slow and costly forms of payments like cash and cheques to real-time and efficient digital payments, and it allows business customers to automate and seamlessly manage vendor and customer payments and cash flow.
The company has crossed US $3 billion in annualized Gross Processing Volumes (GPV) and it aims to close the year at a runrate of US $3.5 billion in processing volumes. PayMate’s game plan in the next three years is to have a million small businesses on its platform. To achieve this target, it plans to scale across verticals specifically focussing on buyer-supplier ecosystem and deliver value from payment and lending. It also aims to increase its workforce from the current 80 employees to 250 employees in the next two to three years.