Instamojo, a Bengaluru-based digital payment solutions provider for small businesses along with custom-tailored business tools helps a business grow on the internet. The platform offers end-to-end solutions to medium, small and micro enterprises with credit facilities, marketing tools, inventory tracking applications and logistics as part of its full-stack digital service.

Mastercard-Instamojo Partnership

In June, Mastercard made a strategic equity investment in payments and online selling platform Instamojo. The partnership aims to empower millions of MSMEs and gig workers in setting up online stores. The initiative also equips these small businesses with digital payment methods to reach out to their customers in a hassle-free manner.

The investment and partnership strengthen the company’s initiative to support gig workers like tutors, electricians, personal trainers and small F&B operators among the lot, to launch, scale and grow their businesses.

Why Did Mastercard Invest In Instamojo?

MSMEs and gig workers are an integral part of Indian economy. With this collaboration and investment, the company aims to digitise the MSME sector.

With the help of Instamojo’s full-stack e-commerce platform for D2C brands and MSMEs, Mastercard aims to extend the company’s evergreen commitment of bringing one billion people and 50 million micro and small businesses into the digital economy sphere by 2025.

Who is Slice?

Slice is an Indian Fintech Start-Up headquartered in Bangalore, Karnataka. Led by Rajan Bajaj, the Founder and Chief Executive of Slice, they are taking on the credit card business of Indian banks. The company’s target customers are millennials and the Gen Z population of India in the average age demographic of 23 years who have inadequate credit worthiness or a non-existent credit score. Some of the services offered by Slice include bill payments, expense management, and a rewards system. Slice is a credit card-based utility payments start-up, and they provide their customers, credit limits through their own balance sheets. Slice recently raised $20 M in a funding round backed by Blume Ventures and Gunosy Capital.

What is the Slice Super Card?

The Slice Super Card is a Visa credit card for Indian youth. The USP of this card is that it’s a lifetime free card without annual fees, hidden charges, or joining fees unlike a traditional credit card offered by a bank.

Idea behind the Product

Slice’s super card is a product that’s being positioned as one of the best ‘credit card challengers’ in India. Slice’s super card has shown the potential to change the upcoming generation’s perception of credit cards. It’s been hailed as the ‘best way for millennials and Gen Z to make payments.

When the founder of Slice interacted with his friends, he learned that although credit cards are useful financial tools, they found them too complicated to use. That is the moment when the ‘Super Card’ product was conceptualised. It was built to simplify credit card usage and make it more accessible to the Indian youth.

Credit card usage in India

There is a huge disparity between the circulation numbers of credit and debit cards in India. While the number of debit cards in circulation has long crossed the 1 billion-mark, credit cards are still averaging in the 50 million.

The Reserve Bank of India has issued critical new policies to prevent online merchants, payment partners and e-commerce sites from storing customer debit and credit card information. The apex body has commissioned companies to develop a strategy for digital payment products and services with their board of directors’ approval.

What are the targeted new RBI guidelines?

When formulating the parameters of a “new product”, the central bank has said that attention should be paid to the general business strategy, the risks inherent in the product and its consistency with the regulations. In the new directive overview, payment security requirements are explicitly discussed in terms of functionality, security, and performance (FSP). 

The considered angles include:

Checking the necessary measures to protect the confidentiality of customers’, data integrity and processes related to the digital products/services provided,

Availability of the necessary infrastructure with the required support of personnel, technology, etc., and

Ensuring that payment products are built securely with high performance, security and stability, and are implemented after completing the necessary FSP tests.

In short, this means that a company cannot store customer’s card data on its servers and data centres. They need to take other data security precautions and avoid data breaches. This also means that whenever customers want to complete an online transaction, they need to remember their card details or have the particulars ready to enter every time. The new rule will take effect from July 2021.