Had to pivot many times due to changing rules: NTT Data Payments Svcs CEO

In a Q&A Dewang Neralla dwells on the journey of being an early mover in fintech, innovation in payments and leveraging its data

Four years after Japanese IT major NTT Data bought a majority stake in Atom Technologies, one of the early fintech players in India, the company has undergone a name change that signals a shifting of gears. NTT Data Payments Services India CEO Dewang Neralla spoke to Business Standard’s Deepsekhar Choudhury about the journey of the company, fintech innovations, leveraging its data and the road ahead. Edited excerpts:

You started the payments business about 16 years back. How do you look at the tech transitions in the ecosystem since then?

If you look at our initial few years, 2006 was too early in terms of payment as an ecosystem. We spent the first three years trying to build technologies and started offering our IVR payment stack in 2008 or 2009.

Rather than going to online payments, we said why not look at alternate payments because mobile payments was going to be a regulated space. And of course, on the risk side, the risks were very high because you did not have two-factor authentication for online payments. 

In 2010-11, new guidelines for OTP came whereas two factor authentication was using a PIN. Today, for example, when I look at the government trying to push for alternate payment in tier three to tier six cities where there's no internet, I think why don't we use voice as a channel to make the payments. That was one of the key innovations that we had done. Around that period, we had also rolled out our own QR code payment solutions.

Players like Paytm and Razorpay that entered the payments market much later have grown to be bigger. Did the company lose focus along the way?

It's not that at any point of time we have deviated from payments and moved on to any other journey. We have been in payments all across. The only thing is we found and pivoted into different different models based on the outcomes of the regulations at every point of time.

Atom started out being a part of the 63 Moons group. Over the years, our approach was to focus on being profitable. We did not go around raising any venture capital funding as the idea was to grow organically in terms of acquiring customers and getting revenue from the customers, rather than spraying money on them. 

What is the scale of your operations at present?

We would be processing at the rate of 100 million transactions annually. Also, these are very high value transactions compared to typical online payments. From a transaction processing value point of view, we would be around $20 billion.

B2B tech companies have to choose between building segment specific products versus a single base software which is tweaked for different segments. What is your approach?

In our case, each of the segments need some minor tweaks. There could be different integrations that could be required, but the core tech stack remains the same. 

For instance, our stock broking customers need third-party validation as SEBI does not allow you to transfer your money to a broker from any other bank account except the one registered with the broker. So, every time an investor transfers the money to a broker, the account needs to get validated. That is one of the core things that we developed early on and created a solution for the industry itself.

You are working closely with B2B segments, but also have a lot of data visibility on the consumer side. Are there plans to leverage that?

The PoS component that we are rolling out for the retail side is where we are looking to build more capabilities. We are looking to mine that data to offer more services to merchants. We are working with several NBFCs and merchant partners to extend buy now pay later, consumer loans and merchant loans.

Is there a round of funding on the anvil after the rebranding?

It's not only about just a name change. This gives us the ability to pull in expertise across geographies, and at the same time act as a vehicle for enabling cross-border commerce. It’s about trying to provide a solution to our domestic merchants so that they can cater to their customers in Asian territories like Thailand, Vietnam or Hong Kong.

NTT Data’s current stake in the company is about 60 per cent. We're definitely looking at growing and I think more investments will be there in the due course of time.

How has your business been growing?

In FY21, we had revenues of Rs 122 crore. We have grown over 100 per cent in FY22 to around Rs 250 crore. Also, FY22 profit should be Rs 25 crore to Rs 30 crore whereas it was around Rs 70 lakh to Rs 80 lakh in FY21.