We often tend to make investments, open accounts, buy policies, etc., without any perspective or insights. We are well-informed via terms & conditions from these companies, however, no one takes the plunge to read it and understand it well. To make matters worse, people often lose money and take loans at higher interest rates. Our guest for today, suffered through similar problems and created an entire service around it ,i.e., BankSathi.
BankSathi is a financial distribution channel that is empowering financial advisors and entrepreneurs using AI technology. Focused on Tier 2 cities, they have an aim to bridge gaps in financial services for the underserved. With a team experienced in technology and banking, their vision is to create 10 million Financial Advisors by 2030 utilizing AI. The company wants to build a better financial future for India’s underserved communities.
Therefore, let’s start with the interview. However before delving there, let’s learn a little bit about our guest.
Who is Jitendra Dhaka?
1) Could you share the story behind the inception of BankSathi and how your personal experience influenced this venture?
I was born and raised in a tier three/tier four area where I faced challenges obtaining an education loan. After securing a loan at a 13-14% interest rate, I later discovered that loans were available at much cheaper rates, i.e., 9 or 10%. This realization, coupled with multiple childhood experiences of people keeping money at home or resorting to high-interest loans, highlighted our community's lack of financial knowledge.
Having witnessed such struggles, I recognized the need for greater awareness about financial products. There are numerous banks, NBFCs, and other financial institutions in India. However, people often face issues due to a lack of knowledge. Our mission at BankSathi is to empower the next 500 million people by providing access to the right financial products. We believe that offering this access can make a significant impact and empower individuals to make informed financial decisions.
2) As a fintech entrepreneur, what are your primary challenges while establishing BankSathi in a diverse market like India?
Yes, indeed, we faced numerous challenges. My background is in technology; I pursued engineering in computer science and developed a tech product during college.
Entrepreneurship runs in my blood. Before founding BankSathi, I ventured into media buying and technology, which allowed me to travel across multiple cities in India. This experience exposed me to diverse consumer mentalities, from Metro to Tier 1, Tier 2, Tier 3, and beyond. It was something that spanned different countries.
Confident in understanding what people were looking for, we launched BankSathi with a vision. However, the biggest challenge was uniting financial institutions like banks, NBFCs, and fintech on a single platform.
“Despite my non-banking background, my passion for banking and fintech fueled a learning journey that took around 17-18 months to onboard our first bank. This challenge turned into a valuable learning experience.”
We have strong relationships with banks, and our onboarding process has been streamlined to onboard a single product in a maximum of 15 days. We anticipate further improvements in the coming two to three years.
3) Considering you aim to have 10 million advisors by 2030, how are you planning to achieve that ambitious goal?
In India, with a population of 1.4 billion, trust is crucial when purchasing financial products. Currently, around 10 million people are engaged in distributing financial products, but they lack a unified platform to access multiple products seamlessly.
Many agents specialize in specific products, such as life insurance, motor insurance, health insurance, or credit cards, limiting their offerings.
To address this gap, we developed the Agent Platform. It provides agents access to various financial products across multiple categories and institutions on a single platform.
Another significant challenge in the agent community is a lack of knowledge on selling and advising on the right products. We addressed this by initiating daily live training sessions and providing recorded videos. Agents now have the opportunity to learn about loans, credit cards, and other basics. They can also inquire about selling strategies, benefits, and educating customers to maximize the advantages.
The onboarding process, which used to take 18 months for the first tie-up, is now simplified with BankSathi. Agents can sign up easily and gain access to all products within minutes.
Over the past two years, we've created a significant word-of-mouth presence within the agent community. Agents have collectively earned over 100 crores, with around 5,000 to 6,000 active agents earning a monthly average of more than 15,000—surpassing India's per capita income. Our vision is to continue contributing to employment opportunities, aiming to be the largest financial product distributor by 2030 with the support of these 10 million agents.
4) Is your idea to educate agents in tier 1, tier 2, and tier 3 cities?
Yes, indeed. Our ultimate goal is to reach the last mile of this country, covering every PIN code. Our tracking is at the PIN code level, and we aspire to be in every PIN code nationwide. Currently, we have agents in 98% of PIN codes nationwide.
5) How does BankSathi ensure the security and privacy of the users' data?
Yes, privacy and security are valid concerns in today's world. What we're doing at BankSathi is digitizing and providing technology to our agents. They don't collect any data from customers directly.
At the BankSathi level, all data is fully secure on our cloud servers. As the founder, I don't have access to any user data, ensuring compliance with RBI guidelines and maintaining a high level of security during bank audits.
Consumers can feel confident as agents do not access their data. We don't collect account data that allows us to withdraw money. This approach enhances trust and security for users.
As for the evolving fintech landscape in India, it's still in its early stages. The penetration of financial products in India is low compared to developed countries. For example, India has only three credit cards per 100 people, China has 50, Singapore has 150, and the USA has 330. This represents a significant opportunity.
Over the last two to three years, the digital era has begun, and customer acquisition journeys are increasingly happening through end-to-end digital processes. This digital transformation supports the growth of BankSathi and the entire fintech ecosystem. Our research indicates that the industry will grow by 20% to 25% CAGR for the next 5 to 10 years.
People are keen to adopt credit products, and with BankSathi, our vision is to provide the right financial products. For instance, we help users compare and choose the best-suited account based on interest rates when opening a bank account.
Similarly, we guide users towards low-interest options for loans, helping them save money. Overall, our goal is to assist users in making informed decisions and either grow or save their money.
6) How do you stay ahead of the curve regarding innovation?
We are a technology-first platform, and technology plays a pivotal role in our overall vision and mission. Currently, we assist customers in 98% of PIN codes nationwide.
This extensive reach is made possible solely through technology, as we don't have physical BankSathi representatives. Our agents leverage technology, utilizing strong algorithms and data analytics to provide eligible product options based on customer details.
Through advanced technology, customers can easily see the products, compare options, and make informed decisions. We use conversational AI, allowing customers to ask questions anytime, even at night. Our trained AI responds promptly, assisting. In essence, technology is at the core of our operations, ensuring efficient and accessible services for our customers.
7) Considering that BankSathi also offers AI services, what are the challenges to developing and training AI systems in this constantly changing market in India?
Firstly, we operate in a highly regulated segment under the oversight of entities like RBI, IRDA, and SEBI. While regulations are crucial, we face challenges as we explore new initiatives. Many considerations come into play before implementing any new idea. Therefore, we conduct numerous experiments to enhance support for our agents, assist financial institutes, and enable consumers to make informed decisions before purchasing financial products.
These new challenges require careful thought, and our Research and Development (R&D) department is constantly experimenting to find effective solutions. We focus on improving the user experience (UX/UI) through AI, testing various implementations to build a better overall experience. Despite the challenges, we are committed to leveraging AI in these different aspects to enhance our services.
8) How do you foster a culture of continuous learning and innovation within your teams? How do you keep them updated with the current knowledge and education?
Our dedicated Learning and Development (L&D) Department at BankSathi constantly evaluates and enhances our content. This involves staying updated on the latest market trends. We collaborate with professionals from banks and financial institutes to educate our advisers. Our team creates new content covering two main areas.
Firstly, we provide basic knowledge about the financial industry, explaining how it operates, including lending processes, credit operations, bank account functionalities, and investment mechanisms. This foundational education is crucial.
Secondly, we create content specific to different departments or products. For example, if it's about an HDFC Bank credit card, our content helps consumers compare products and understand which suits them best. We address common gaps in knowledge, such as how to use a credit card or understand the terms and conditions.
In India, there's a significant gap in understanding financial instruments. Even after obtaining a credit card, many people may not know how to use it properly, leading to penalties. We bridge this gap through short videos and content highlighting the dos and don'ts of financial products.
Similarly, with loans, we guide consumers on the importance of paying EMIs on time and maintaining a good credit score. Despite increasing awareness, more than 95% of the population in India is still not fully aware of the significance of a credit score.
In this context, we contribute by continually improving our content, conducting research, and identifying gaps in the fintech landscape. We aim to empower individuals with knowledge and contribute meaningfully to the financial ecosystem.
9) How has the partnership after two funding rounds influenced BankSathi’s journey?
Well, we have successfully raised funds two times. Once during the seed round and the second in the pre-Series A round. We've received significant support and appreciation from notable fintech entrepreneurs, financial institutes, and seasoned entrepreneurs who have excelled in their ventures. These individuals are genuinely interested in understanding our initiatives and are enthusiastic about contributing to our journey.
What stands out is that around 80-90% of these entrepreneurs are first-timers from tier three or similar backgrounds. Their understanding of the existing gaps in the market and the challenges individuals face in those areas resonates with our mission. Their support goes beyond financial contributions. They actively engage with us to help BankSaathi grow. They provide valuable insights on improving ties with banks, enhancing our technological capabilities, and overall strategizing for better outcomes.
So, in addition to the financial backing, we've received a lot of support and guidance from these experienced individuals, and we are truly grateful for that.
10) How do you envision the future of financial advisory services in India? Also, how do you think BankSathi would align with this vision?
Financial advisory is a significant aspect of our focus. Currently, only around 5 to 10% of the population has some awareness of financial matters. If we exclude the lower 50%, we still have approximately 500 million people aspiring to grow. These individuals desire to utilize credit, use bank accounts, and explore investments. The market size is vast, covering a considerable portion of the population.
“We aim to cultivate serious entrepreneurs or advisers in every PIN code nationwide. In the same way that there's a Kirana store in every locality for daily needs, we envision having financial advisers available everywhere.”
We're actively working toward this vision. If someone needs advice on any financial product, a knowledgeable person should be available. This includes assistance with bank accounts, demat accounts, investments, insurance, credit cards, and loan products. Our vision emphasizes the importance of having informed advisers accessible to individuals.
To achieve this, education is crucial. We're focused on creating educated agents who can provide knowledge-based advice. Through technology, we empower these agents with the necessary information. Marketing efforts are directed towards supporting them. All our agents are technology-empowered, utilizing technology to match customers with the exact products that best fit their financial needs and requirements.
11) You’re so passionate about entrepreneurs and entrepreneurship. What entrepreneurial advice would you like to give our generation?
Yes, absolutely. I want to share some advice to all young entrepreneurs: whenever you encounter a problem, take the time to figure it out. Assess how many others are facing a similar challenge, and then think about how you can solve that problem or add value to it.
“Even if you can save people's time or energy, you've made a meaningful contribution.”
In the case of BankSathi, I understand how we are helping consumers because I faced the same problem in my life. Experiencing the issue firsthand allows me to empathize and realize how many people we can assist in overcoming that particular challenge.
12) What do you think about the content creators' world of social media? Do you have some advice or opinions about the content creator world?
Before BankSathi, I worked in the era of content creation, generating over 1 billion views on our websites. I want to share advice for influencers and content creators, whether on social media, blogs, or any platform.
Create genuine content to gain followers and provide actual value to your audience. If your content is relevant and adds value to someone's life, you will become a significant influence over time. It may take a while, but authenticity and respect from the audience will follow.
Regardless of the niche, focus on creating relevant, knowledgeable, and well-researched content. Influencers significantly impact people's beliefs, and providing accurate information is crucial. Be mindful of your influence; delivering accurate and helpful content contributes positively to people's lives. Always remember that there is no authority to do wrong with anyone, and strive to use your influence responsibly.
13) What advice do you give entrepreneurs who feel discouraged and think about quitting because of a lack of results?
Once again, for the KPI (key performance indicator), we need to track the meaning of the result. If someone expects to make money from day one as an influencer, it's not an easy task. However, if they genuinely love delivering content and adding value to their audience, whether it's a younger or older demographic, tracking the KPI of how many people are benefiting from the content is crucial. Sooner or later, this value addition will likely convert into monetary returns.
- BankSathi was founded to empower 500 million people in India by delivering the right financial products.
- A 17-18 month learning journey has led to successful tie-ups with banks, streamlining the onboarding process.
- BankSathi wants to reach the last mile, covering every PIN code and 98% of the country's area.
- BankSathi has successfully raised two rounds of funding and experienced entrepreneurs who contribute financial backing.
- Authenticity and accurate information are emphasized to build positive influence over time.
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