BENGALURU: Regulations in the fintech industry have only enabled India to become a global benchmark in fintech and UPI is one such example, said Rahul Kothari, Chief Operating Officer at Razorpay.
In an interaction with TNIE, he said regulations established by the Reserve Bank of India (RBI) have played a crucial role in driving financial inclusion and co-creating financial literacy. Recently, Finance Minister Nirmala Sitharaman met fintech companies and start-ups, and asked regulators to hold monthly meetings with them to address their issues.
When asked about it, he said it is a welcome move and such open dialogue and regular communication will only help the ecosystem come together to mitigate the data, cybersecurity and KYC-related risks, thereby enabling proper adherence to regulatory frameworks.
The Bengaluru-based fintech firm recently launched four new products including Razorpay Payment Gateway 3.0 and UPI-led QR stack for enterprises called Razorpay Dynamic POS Device. Kothari said, “Our goal is to enable companies to focus less on managing money movement and more on innovating, ideating, and scaling their operations.”
The company has also initiated the process of relocating its domicile to India from the US. “This transition is estimated to take up to 12 months, pending regulatory approvals from both the US and India, which are required for various aspects of the move,” he said. In 2022, PhonePe moved its domicile from Singapore to India and its investors had paid R8,000 crore in taxes.
Razorpay is also planning to go for an Initial Public Offering (IPO) after two years as its reverse flipping process to India is set to close in the next six to 12 months.
“We would like to go for the IPO as a profitable entity, with both our payments and non-payments business achieving profitability. Public markets in India specifically prefer profitable companies. We are fairly ready if we were to just go public as a payments company,” he added. Its payments business is already profitable, but around 25% of its revenues also come from non-payment businesses like RazorpayX and Razorpay Capital. “We would like to give ourselves about two years to achieve these milestones before we go public,” he added.
Global foray
“Malaysia is step one of our international expansion, last year we launched an international payment gateway for the Malaysian market, post our acquisition of Curlec, which is Malaysia’s leading recurring payments platform in 2022. We see immense potential in the SEA region, the market is where India was 8-10 years ago. Our foray into international payments gives us the necessary boost to innovate more in SEA,” he said.
Razorpay has evolved from an online payments company to becoming the country’s full-stack financial solutions company. Kothari said that they want to be seen as a one-stop platform for all the money movement needs of businesses not just in India but in Southeast Asia too. “We believe we are making a significant impact in the overall fintech landscape by applying analogies from the past to tackle the challenges that persist,” he added.