Online marketplace for financial services BankBazaar, is set to turn profitable on EBITDA basis by March 2020. Emerging out of what has been a turbulent year for the financial services market, BankBazaar has seen a 46% increase in monthly revenue between October to January, CEO Adhil Shetty told TNM.
Adhil says that by focusing on its core offerings, and controlling costs, the company has seen a good second half (of FY20) and hence is on the cusp of being EBITDA profitable. EBITDA of a company indicates the profits clocked before paying interest, taxes, depreciation, and amortisation.
“This has been one of our goals. Having had a tough start to the year because of macro pan-industry reasons, by focusing on consumer engagement via free credit score, and by focusing on paperless checkout, we've really seen a good second half of the year. So, this is very, very strong momentum going into the next year,” Adhil told TNM.
For BankBazaar, growth has mainly come from its free credit score offering and its paperless checkout service that it offers with all banks and non-banking financial companies (NBFCs).
Adhil says that credit score is something people have really grown to track and use in India.
“We really focused on helping people track and improve their score. So, our mobile app shows you your active accounts, what your credit card balance is, what your repayment history is, and if there's a problem, who you need to contact to fix it. So, I think Indians, especially the millennials, are all aware that there is something called a credit score and that it is important,” he adds.
BankBazaar claims that 77% of consumers tracking credit score on its platform have a credit score of over 700.
Apart from this, Adhil says that paperless dispersals of financial services too, has greatly helped the business. RBI recently modified its master KYC norms to allow video KYC, which according to Adhil, has been a game-changer for the industry, especially in enabling financial inclusion.
“We don’t offer loans per se. We're a platform that helps people manage their personal finance. We have 40 million registered users and we enable them to access all the banks, NBFCs, fintech companies and enable all kinds of KYC. So, I think that's worked well for us. Because irrespective of whether one institution or one NBFC is doing well or not, the platform as a whole has scaled because of being paperless,” he adds.
But the major boost to growth, Adhil says, has been organic traffic. These are the users who use various tools offered by BankBazaar such as the free credit score, personal finance manager, content, etc. Growth in organic traffic through the use of these tools has also majorly helped boost revenue and has helped BankBazaar reach EBITDA profitability.
In FY21, BankBazaar claims it is poised for tremendous growth.
By focusing on consumer engagement via free credit score, and by focusing on paperless checkout, which has been helped by the government, we've really seen a good second half of the year. So this is very, very strong momentum going into the next year. Now, we believe we're scratching the tip of the iceberg, because, you know, there are 200 million consumers who have a credit score in India, we have over 100 financial institutions which wanted to reach out to consumers. So we as a platform, believe that FY21 is going to be a year of tremendous growth.
“The best it's ever been. And I think what we're excited about is that this time, its being done on an EBITDA profit basis. So, I think next year, you can expect us to continue the same fast growth, organic expansion with EBITDA profitability on the financial side, that's what we're going to deliver,” Adhil adds.