Banks Are Warming up To Startups; Here’s Another Scenario! Essay
Banks have always lent their support to traditional businesses and entrepreneurs. However, with the emergence of new-age startups today, it's important that banks and government agencies tweak their services and policies to facilitate the new breed of entrepreneurs.
The New Economy Group was set up at Axis Bank to specifically focus on companies using technology to build rapidly scalable businesses. The objective of setting up this group was to have a single point of contact for these entrepreneurs to meet all their banking and financial requirements. The group aims to foster relationships with emerging e-commerce companies through a comprehensive model based on technology and innovation.
Entrepreneur India spoke to Tanu Bhargava, Senior Vice President and Head of the New Economy Group to understand the initiatives offered by the bank under this profile.
"The profile of the customers in this segment is very different. They are very young, tech savvy; hence the solution from our end also had to be very tech oriented. We really needed to make banking simple for them and we decided that instead of having a product approach. We decided to have a separate group to give startups tailor made products, customize technology to enable easier usage of banking services," Tanu said.
In a typical scenario, one would see startups open a bank account at one of the regular branches where the services are limited to the basic needs. But in the case of startups, once they begin to evolve, they will require more tailor-made services to suit their requirements to run businesses.
Tanu also briefed us about another strategic initiative, wherein the bank is engaging with fintech companies which it believes has ideas that can help Axis Bank innovate any of its products, processes or services.
Banks warming up to startups
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Several banks in India are gradually getting comfortable with the idea of collaborating and working with the new-age startups. , State Bank of India and private banks have invested their time and money and backed technology startups.
Tanu said that some of the major things entrepreneurs should keep in mind before approaching Axis Bank for its tailor-made solutions is complete understanding of their business models, technology and how Axis Bank can help scale their business.
Thought Factory, Axis Bank Innovation Lab at Bangalore intends to constantly innovate & introduce Banking 2.0 solutions that can radically change consumers' life in Banking and beyond. Thought Factory encompasses an in-house Incubator team, an Accelerator and a start-up hub 'Social' powered by Amazon Internet Services Private Ltd (AISPL), the India affiliate of Seattle-headquartered Amazon Web Services Inc.