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Here’s How Corporate Card Segment Enticing Investments and Enjoying an Upper Hand

The banks’ policies have become rigid and unfriendly to the startups, in turn, inclining companies towards other options, especially corporate card
BY Jaspreet Kaur
Feature Writer, BusinessEx
Mar 10,2020

The Bengaluru-based fintech company, Karbon Card has recently garnered $2 million in seed funding round. Various prolific angel investors had participated in the round, including renowned investors--Kunal Shah (Founder at CRED), Jitendra Gupta (Founder at Jupiter), and Amrish Rau (Former India Head of PayU), amid others. 

The fintech company decides to utilise the offering for operations, business expansion and  product development. It essentially aims at rendering a financial platform to the Indian businessmen. It gives corporate cards packed along with tools, as well as rewards, for early-stage startups in the country, Karbon Card said in its official statement.

“Building a startup and pursuing your passion can be quite challenging.  Along the journey, many founders wish the banks could be more appreciative and supportive of the startups’ ambitions.  Unfortunately, the banks’ position to protect their customers’ savings at all cost make their requirements and policies rigid and unfriendly to startups. Karbon Card is a startup founded for all Indian startups.  Our vision is to empower all startups to achieve more through a Karbon Card. We will strive to improve your cash flow with credit, help you to spend wiser and manage better through our suite of products. Let us worry about these issues while you focus on changing the world,” Pei-fu Hsieh, Co-Founder and CEO at Karbon Card said.              

“I can see first-hand that within a short span of a few months, Karbon Card has been embraced by many Indian startups. We see massive potential for this sector in India. I myself am not just an investor but also an avid user of Karbon Card,” Jitendra Gupta, founder of Jupiter, said.

The corporate credit card of Karbon also offers rewards catering to the startups’ needs like AWS credit, and discounts on services of MakeMyTrip, Hubspot, Uber, Freshworks etc, and expense management software, among others.

Is Purchasing Corporate Cards Better than Availing Bank Loans?

In essence, banks have to cater for all companies irrespective of their business size. However, the commercial banks are presently working averse to their true nature. They tend to help companies who can give them a massive volume right at the day one. Further, meeting banks’ requirements and clearing their probing process have become a tedious process for companies now. In this scenario, the companies prefer taking credits from personal lessors. 

“There is a disconnect in the way that banks understand the startup ecosystem as they have not been exposed to it for a long time; it is a very new phenomenon for them. Operationally, they have not well structured the services either and presently, they are making profits in the other services so they don’t want to have exposure to the startups or smaller customer market. That is the inherent nature of fintech; fintech has possibly surfaced because the banks have become inefficient. If we look at the fintech system as a whole, then probably the maximum number of companies that are funded are fintech presently,” explaining loopholes in the Indian banking system, Amit Jangir, Co-founder at Karbon Card told BusinessEx.

Know What Services This Fintech Company are Offering to the Indian Startups 

The team of Karbon Card carries immense experience in the venture capital and startups ecosystem. They apprehend underpinnings of a startup and how a company grapples to thrive in the industry. In order to lessen problems of startups, it caters for a startup’s expenses like digital marketing, cloud infrastructure providers and SaaS-based tools, etc. Here are other attributes of this corporate card:

 

1. Interest-free Credit 

Karbon Card offers monetary aid to the customers without any personal guarantee. It also bars startups to pay any fixed deposits. Thus, the companies can easily qualify for credit over INR 25 lakhs from the fintech company. 

2. Additional Rewards

In order to aid startups, the company offers worth $50k offers to the users after signing up or creating their account like AWS Activate, discounts from MakeMyTrip, Uber, WeWork and many other Saas products (Hubspot, Segment, Freshworks, etc). The company claims to add more rewards to its platform and is persistently collecting feedback from customers so as to comprehend their needs.

 

3. Expense Management

The company has a tool that helps company owners to keep a track of money they are spending and document variations over time. It also renders reconciliation attributes and, in turn, aid employees in navigating between their several expense reports and then, get them reimbursed immediately.

The Future of Fintech Industry

According to NASSCOM’s report, the Indian fintech software market is expected to double from current $1.2 billion to $2.4 billion in 2020.  The number of angel investments increased from 370 in 2014 to 691 in 2015, while overall investments increased multifold from $247 million in 2014 to more than $1.5 billion in 2015. 

“In the country, the scope and potential of fintech is huge. If we look at the credit card penetration in the country, then it is less than 5 per cent. No matter what goods you purchase, fintech always has a part of it. Businesses are about trading of goods, which require money and money, in turn, is part of every transaction. Thus, it demands fintech to be a part of every transaction that happens in every economy,” Jangir explains the role of fintech in everyday life pragmatically. 

“The fintech companies collect data as to where people spend money, where they buy different things, and also, a resolution of infrastructure wherein resolution is being put around KYC, opening of bank accounts. There is an opportunity for fintech companies to make this entire process customer-friendly and less heavy from an operations perspective,” Jangir added.

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