Middlemen on way out, B2C deals gain traction

As digitisation cuts down on middlemen, banks are seeing an increased demand for Business to Customer (B2C) solutions. Recent bank-fintech partnerships were focused mostly on B2C solutions, say experts.

“Traditional corporates who had focused on B2B (Business to Business) like supply chain payment solutions through banks, are now engaging with us for developing B2C solutions for their end consumers and employees viz., loyalty cards/wallets that can be used in the open market,” said Ritesh Raj Saxena, business head, retail banking, digital & payments domain, IndusInd Bank.

The bank has partnered with fintech companies for various B2C solutions ranging from wallets, payment gateways, digital lending, micro ATMs and so on.

Axis Bank has also seen rising demands for B2C solutions from clients in financial services, consumer goods, transportation and new economy businesses. The bank is working on multiple solutions on IMPS, ABPS and payment gateways with several B2C clients.

Financial institutions, such as insurance companies, non-banking finance companies as well as small merchants, are following in the footsteps of ecommerce firms eager to convert

‘Cash on Delivery’ business to digital, said industry players.

Citibank’s recent fintech partnerships are mostly centered around maximising efficiency in the process of receiving and sending payments for businesses. “Technology has removed a lot of middlemen and led to an increase in B2C instead of B2B transactions,” said Morgan McKenney, head of core cash management, Citi Asia, at a press meet.

B2C solutions, especially mobile-based solutions, help businesses looking to target new customers and expand customer base.

“While B2B solutions Fintech are being used extensively by banks as part of their digital solutions, B2C Fintech are engaging with banks as a lead originator or front end for penetrating into new customer base, specially digital natives and new adopters of formal banking ecosystem,” said Sachin Seth, partner and Fintech leader, Advisory Services, EY.

Digitisation has helped provide a platform for seamless integration of the entire ecosystem, leading to prevalence of ‘B2B2C’ solutions, bankers said.

Insurance firms, non-banking finance companies, as well as small merchants, are following in the footsteps of e-commerce firms eager to convert ‘Cash on Delivery’ business to digital