The Asian Age interviews Akash Sinha, Co-Founder and CEO at Cashfree

Cashfree, one of the up and coming business payment companies in India recently introduced the “instant settlements” feature. The company also plans to scale this feature and disburse up to 300-500 crores per month. Cashfree has over 55,000 customers that include prominent names such as Xiaomi, Tencent, Zomato, Cred, Club Factory, Shell, and Dunzo. While the company has grown quickly, we spoke to Akash Sinha, Co-Founder & CEO of Cashfree to deep-dive into the company’s future plans and how this new feature will help businesses and its end consumers.

Could you elaborate on how Cashfree’s Instant Settlement option will affect the nature of the transaction? How will the feature help businesses?

At Cashfree, we work very closely with our merchant partners to identify their pain points with payment collection and disbursals. Overwhelmingly, delays in funds being released are one of the biggest deterrents for businesses to adopt digital payments.

With ‘Instant Settlements’, businesses can access their funds within 15 minutes of capturing a payment, even on bank holidays. This eliminates the need to wait for three or more working days to receive settlements. Banks typically follow a T+3 settlement cycle; implying if the payment is collected on Monday, it will be available for use on Thursday. This feature allows businesses to utilise online payments at par with cash and provide them with better liquidity. For instance, wherever inventory is involved, businesses can use the same funds to replenish and increase the volume of existing stock, minimising dependency on any credit line.

Could you briefly explain Cashfree’s business model and how does the Instant settlement benefit Cashfree?

It was in the early days of Cashfree that we recognized that in digital payments, an unaddressed and underserved challenge for businesses was that bulk payments and disbursals. Since our inception in 2015, we have worked closely with leading banks and merchants to create disruptive products that allow businesses to automate bulk payments and disbursals.

Cashfree automates money transfers through 100+ payment modes to enable businesses, marketplaces, and fintech undertakings to facilitate seamless cash flow. We are enabling an ecosystem of digital transactions, working closely within the banking infrastructure to help both startups and established companies make digital payments work for them. Businesses can easily use the Cashfree Dashboard to create subscription plans and add users through SMS, email or WhatsApp alerts. Businesses can also integrate the Cashfree API with their internal product or enterprise resource planning (ERP) to automate the entire process.

Apart from Instant Settlements, we earlier launched nine products, including six industry-first fintech innovations:

• Payouts, the first gateway in bulk disbursal solution
• Instant refunds, available for the first time on a payment gateway
• Cashgram, an instant refunds solution on Cash on Delivery orders, for the first time
• Pre-authorization, which block funds temporarily & debit full or partial amount on fulfilment
• Subscriptions, one of the first gateways to offer recurring payments via e-mandate
• Same Day Settlements, industry-first feature of T+0 settlement cycle

With Instant Settlements, our goal is to make digital payments as attractive and easy as handling cash and strengthen the payments and banking infrastructure in India. As part of the introduction of ‘Instant Settlement’ feature, we will soon extend the facility to other collection products, including auto-collect and marketplace settlement besides Cashfree payment gateway users. We expect to disburse up to INR 300 - 500 crores per month via Instant Settlements.

What are Cashfree’s future plans and what steps have you undertaken to achieve them?

At Cashfree’s core is a drive to solve problems faced by businesses in digital payments and disbursals. This guiding force, coupled with a robust and knowledgeable team, has seen our profitability increasing exponentially over the last few years. Cashfree’s revenue tripled from March 2018 to March 2019.

Cashfree’s strong growth trajectory that has witnessed our headcount increase from around 40 people in April of 2019 to more than 100 people in January 2020. Today, we have operations in 4 cities – Mumbai, Delhi, Chennai and Bangalore and are looking to expand across India.

We are also turning our focus on working to enable the digital payment’s ecosystem. We work with all of India’s leading banks comprising 50+ banking partners. Currently, we work with over 55,000 merchants and we aim to secure 5 lakh, merchant partners, by the end of 2020.