Innoviti turns EBITDA Positive as Revenue and Margin Growth Accelerates.

7 October 2020

Sharp focus on category specific product development helps achieve this milestone, a rare achievement amongst fintech companies in India
  • Innoviti, a leading provider of intelligent payment solutions, announced that for the month of September 2020 it has turned EBITDA positive. The company had set a December 2020 timeline for this target and has achieved it three months in advance. Innoviti had raised Series C earlier this year to further its differentiated strategy of category specific product and market development.  Break-even is the outcome of this strategy, driven by the dual impact of revenue increase and cost rationalization.
  • Innoviti is in the business of creating software that turns payment transactions into business collaborations. By bringing banks, brands, and merchants to partner, discover and delight their common consumers with superior offers at the point of payment, Innoviti is helping businesses accelerate sales with shared costs, driving a more profitable growth than possible with conventional means.
  • Revenue increase has come on the back of a) several enterprise customers migrating to Innoviti as they embrace digital solutions to drive growth and efficiency beyond mere payment terminals, and b) crafting of a new product for small electronic merchants that enables them to design their own affordability schemes, helping them drive their business in their own unique ways. Revenue has doubled in the past 4 months.
  • Cost rationalization has been brought about through deep investments in setting up of warehouses and automating supply chain and support system to dramatically rationalize costs, while enhancing customer experience. This has resulted in a 9% improvement in gross margins.
  • Innoviti has also improved the payback on its new customer acquisition through changed distribution models that not only provide for faster reach but also better capital efficiency. The payback has reduced from 14 months to 3 months.
  • Over the next six months the company will be focusing on a rapid expansion in the electronics category through a slew of product launches with an aim to take its current market share from 10% to 25%. In line are enhancements to a) enable merchants to extend DIY benefits from physical retail to online channels, b) expand merchant reach from current 100+ cities to 500+ cities, and c) expand lender base to expand consumer choice through a channel independent installment platform.
  • With EBITDA break-even the company has also reversed the salary cuts put in place in March 2020 in response to the disruption caused by the COVID pandemic. From October 2020 the salaries as of March 2020 are being reinstated.  Buoyed by the rapid growth, the company has also announced an aggressive incentive plan for the team.

Quotes

“We are a software company that is turning payment transactions into business collaborations.  Unlike typical payment networks that connected a buyer to a seller, we connect multiple sellers (bank, brand, and merchants) to a common consumer.  Sellers who talk to the same consumer but have no easy way to talk to each other.   We enable businesses to collaborate and discover new and unique ways of delighting their common consumer through superior offers delivered with shared costs.   This is unique!  A small merchant can collaborate with large banks with the same ease and flexibility the way a large merchant does.  A large bank can partner with a large merchant on a transparent basis, discovering the best pricing, without biases coming in the way.

As an equal opportunity unbiased network, we are creating collaboration at a common moment of truth for all businesses – the point of payment.   There cannot be a purer way for businesses to evaluate the impact of what we are bringing together.

Our category specific approach is driving unique and differentiated experiences right through the customer journey – when they buy the product, when they use the product and when they need support.  Current affordability products in electronics category cater to less than 30% of the demand.  There was a crying need to unbottle this through product innovation, we are happy to see that our recent product launches have been received well by the market.

We were planning to hit EBITDA break-even in March 2020, however the pandemic hit.  We had to cut salaries and along with the team we agreed that the month we hit EBITDA break-even we would reverse the cut.  We also agreed that we need to do this no later than December 2020. It is exciting to see that we achieved the target 3 months in advance.

We believe we are entering into a sustained hyper-growth phase over the next few quarters.  We are excited and confident of leaping and leading in this market.”
– said Mr. Rajeev Agrawal, CEO, Innoviti.

About Innoviti Payment Solutions Pvt. Ltd., Bangalore, India.

http://www.innoviti.com

Innoviti Payment Solutions Pvt. Ltd. has been a pioneer in the use of technology to add intelligence to payment transactions helping merchants, banks and brands utilize the full power of digital payments to drive business growth. The company processes over 6.5B$ of merchant payments from over 1000+ cities with a volume throughput per installation that is 2X of the country’s average. Catamaran Ventures, SBI Capital, Bessemer Ventures and FMO are investors in the company. The company has several patents filed for with two awarded.  Innoviti is the winner of Mastercard’s Innovation Wizards Award for its instant onboarding innovation, and Reliance’s Most Promising Growth Consumer Finance Award for its #KuchBhiOnEMI innovation in 2019.   Innoviti is the only Indian payments SaaS company to be awarded the SOC3 seal of excellence for adherence to principles of trust in privacy, security, confidentiality, availability, and processing of transactions.

Media Contact:

Sarath Chandra Nerella
Associate Vice President – Marketing Communications
sarath@innoviti.com
Innoviti Payment Solutions Pvt. Ltd.

Download Brochure

    Credit card EMI uses your credit card limit to convert your purchase into installments. Suppose you make a purchase for Rs. 9,000 on your credit card and while buying select the credit card EMI option with a tenure of 3 months, then the bank instantly converts your purchase to three installments of Rs. 3,000. In the next credit card cycle, instead of paying Rs. 9000, you will need to pay only Rs. 3,000, and continue paying this for 3 months. A nominal interest or processing fee may be charged depending upon the various schemes running at the merchant.

    If you don't own a credit card and would still prefer paying in instalments, you can use your Debit card to make select purchases on EMI.  Your debit card bank may have qualified you, you can check the bank on the same by sending the following SME message to your bank:

     

    HDFC (Min value is 5 K)

    SMS MYHDFC to 5676712 from your

    Bank registered mobile number, or

    To check your pre-approved eligible limit

    give a missed call to 9643 22 22 22

     

    AXIS (Min value is 5 K)

    SMS DCEMI<Space>XXXX (last 4 digits

    of your debit card number) to 5616100

     

    Federal (Min value is 5 K)

    DC<space>EMI to 5676762 / 9008915353

    or missed call to 7812900900

     

    Kotak (Min value is 8K)

    SMS CDL<space><last 4 digits of your

    Debit Card No> to 5676788

     

    ICICI (Min value is 5 K)

    SMS DCEMI<space><last 4 digits of

    Debit Card number> to 5676766

     

    While making the payment, notify the store executive to swipe your debit card transaction in the EMI mode and select a preferred tenure. The transaction will get approved on your bank as per your qualification and converted into EMI for the number of months selected during the transaction.

    Buy Now Pay Later (BNPL) is like using a credit card or getting a loan and repaying in EMI. The only difference being that it is for an ultra-short duration of 15 days to 60 days.

    Merchant will get the money the next working day from the bank.

    Interest costs depend from case to case. For example, in: Zero cost EMI - Customer doesn't pay the interest cost Bank EMI - Customer pays 12 to 15% interest cost depending upon the bank. Buy now pay later scheme (15 days) - Customer pays around 1.16% interest, again depending upon the banks. Buy now pay later (30 days,60 days and 90 days) - Customer pays 2.33%, again depending upon the banks.

    Processing fee is the amount charged by a credit/ debit card issuer to process your customers loan booking. For example, HDFC Bank charges Rs. 199 as processing fee for both CC and DC EMIs.

    IMEI validation is done by entering the IMEI number into the Innoviti terminal which then gets validated by the brand for an authentic product being sold.

    IMEI validation is done for Brand EMI transactions.

    The offers could be on any brand, product, bank card, being offered on any specific dates or any specific SKUs

    SKU promotions start with the cashier scanning SKU, IMEI/ Serial number from the billing POS and entering the amount in the billing POS and then transacting under the "Brand EMI" tender mode.

    As SKU comes directly from the billing POS via scan, it reduces the errors and manual effort of selection to re-enter/select again from the EDC.

    Joint promotions are offers provided to consumers in which two or more parties are bearing the cost of the offer. It is a highly efficient mechanism to reduce the cost of marketing. Small merchants can benefit by getting their name associated with large banks and brands.

    Innoviti has used payments technology in unconventional ways to bring merchants, banks, and brands together and enable them to run joint promotions for their common consumers.
    Innoviti’s uniPAY Next and GENIE products can run instant cashbacks, EMI, upgrade offers and others with two or more parties bearing the cost of it.

    The MDR, or Merchant Discount Rate, is a fee paid by the merchant to its bank for accepting payments card payments. This is typically calculated as a percentage of the transaction value undertaken through credit/ debit cards.

    Merchants can negotiate with banks for better MDR rates. With greater scale, merchants enjoy better negotiation power. You can also reduce MDR using Innoviti’s sophisticated multi-bank routing technology in uniPAY Next.

    Innoviti's uniPAYNEXT multi-bank routing technology automatically routes every card swipe to the bank that will charge the lowest MDR for it.

    Innoviti’s uniPAYNext technology uses an advanced #LookAhead technology to instantly scan the store and bank networks and identifies the best route from the store to the bank to improve transaction reliability. It optimizes speed, cost & reliability based on merchant pre-set rules to select the bank.

    Mismatches between a merchant's daily sales bank card settlements creates unnecessary manual reconciliation work. Innoviti's uniPAYNEXT technology digitally adds the approval code and approving bank name to the billing system enabling automatic reconciliation.

    The reports can be seen on SPARCS, uniPAYNEXT's reporting portal. This comprises of some very useful information like daily settlement receivables from each acquiring bank, store sales by different card issuers or regions or payment tender modes opening new possibilities for joint marketing programmes.

    UPI stands for Unified Payment Interface (UPI), a technology created by National Payments Corporation of India (NPCI). It allows transfer of money from one bank account to another instantly via one's mobile phone. Innoviti supports UPI payment via any UPI app such as Paytm, GPay, WhatsApp Pay, PhonePe through its terminals. To know more, click here.

    You need a Sodexo card issued by your employer. You can use your Sodexo card to pay for your food & grocery purchase on any Innoviti terminal in your F&G store. To know more, click here.

    Innoviti supports all Visa, Master, Rupay cards, UPI, Sodexo, other meal cards, EMI, Buy Now Pay Later Plans and loyalty point redemption through debit cards of banks supported by Loyalty Rewardz.

    How can I get my shop name added to Innoviti’s advertisements on Google?
    Once you sign-up with Innoviti and your GENIE app is installed, your name will automatically get added to the advertisements. It takes between 4 to 5 days for the name to start appearing.
    How can I get my shop name added to Innoviti’s advertisements in banks?
    Once you sign-up with Innoviti and your GENIE app is installed, your name will automatically get added to the advertisements. It takes between 4 to 5 days for the name to start appearing.
    How does GENIE coupon work? On which banks is it applicable?
    GENIE coupon is an instant discount offered by Innoviti to every consumer whose payment is done on Innoviti’s mobile app by the merchant. Customers need to enter their mobile number in the app, they will instantly receive an OTP through SMS/ WhatsApp, entry of this OTP applies the surprise instant discount on the purchase value immediately.
    Example: If your purchase value was Rs. 10,000, and the coupon value is Rs. 500, then your charge-slip will be approved for Rs. 9,500. You save instantly. The merchant gets the full money.
    It is applicable to credit/ debit card holders of 100+ banks in India.
    Does wallet work on refurbished products?
    Yes. GENIE’s EMI wallet can be used to provide zero-cost EMI on refurbished, second- hand and upgrade plans.
    How can I get access to customers qualified for credit by banks?
    Banks work with aggregators to provide access to these customers. Innoviti is a leading aggregator which can provide you with a terminal that will connect to the bank and provide you access to these cardholders.
    In addition, Innoviti in coordination with the bank will promote your store to all the bank’s customers who are pre-qualified.

    Brand EMIs are joint promotion schemes used by merchants, banks, and brands to incentivize a consumer to buy a higher end-product than what they can afford. The purchase is converted into EMI instantly by the bank, with the interest cost being borne by the product brand.

    Innoviti has partnered with 100+ brands including Apple, Samsung, Vivo, Oppo to extend 1000s of such schemes.

    You need to be pre-qualified by your credit, debit card bank to be eligible for Brand EMI. The bank will typically look at your credit card and savings account history to qualify you.

    Innoviti’s technology instantly checks with the bank if you are qualified to approve your Brand EMI transaction.

    Does wallet work on unbranded products?
    Yes. GENIE’s EMI wallet can be used to provide zero-cost EMI on any unbranded electronics product like headphones, power banks, speakers, etc.
    How does BEAM work?
    BEAM (Brand EMI Acceleration Mission) offer gives merchants the option to get sponsored by one of the leading mobile brands that they represent. Innoviti has tie-ups with brands like Samsung, Oppo, Vivo and Xiaomi. Using BEAM, merchants get 1% extra margins on the sponsored brands and 0.5% extra margins on the rest of the brands