As financial institutions deepen their penetration in underserved markets, they face a two-pronged challenge of providing customized product offerings while keeping their operating costs low. Though there have been many innovations in customer acquisition and leveraging technology solutions to streamline loan process management, the interactions between financial institutions and large banks continue to face much friction, holding these financial institutions back from serving micro and small businesses.

Financial institutions must interact with the core banking systems of banks to access their current and escrow accounts, conduct customer onboarding, and move money between accounts for disbursement and collection of loans. Typically, these functions are performed manually, and financial institutions lack a unified platform that can enable seamless access and a unified view of accounts across different banks. We believe that the next phase of digitization will streamline interactions with banks and financial institutions, thereby building operational efficiencies that enhance the competitiveness of financial institutions in reaching the underserved customer segments.

TransBnk is building the rails between large banks and financial institutions, seeking to enable seamless and compliant interactions. They aim to transform the banking and lending ecosystem in India by building a transaction banking platform for incumbent and new-age financial services companies to monitor, manage, and reconcile their multiple current and escrow bank accounts, and digitize their customer onboarding. Financial institutions can better serve their MSME customers by gaining digital access to critical data needed for loan underwriting, monitoring, and more.

Accion Venture Lab is thrilled to invest in TransBnk. The company’s product helps financial institutions leverage API-based integrations with their banking or lending partners to seamlessly manage their treasury function and money movement. We see multiple other lending and customer life cycle management use cases emerging from the banking infrastructure that the company is building. We are excited about the company’s ability to innovate and launch new products centered around the pain points faced by their customers. Here’s why we are excited to support TransBnk on their journey:

Reduce delays and increase access to loans

TransBnk’s rails enable several exciting use cases for financial institutions by digitizing their critical business functions. TransBnk digitizes the loan management life cycle for lending companies to drive efficiency and scale. Without the services provided by TransBnk, lending companies typically perform customer onboarding tasks offline, causing delays in loan disbursement and inconveniences to end customers. The lending companies on TransBnk’s platform can digitally onboard their MSME (or retail) customers by conducting know-your-customer (KYC) and penny-drop account verifications and setting up equated monthly installment (EMI) deduction mandates. Through TransBnk’s platform, lending companies can seamlessly set up escrow and current accounts and view dashboards that present a unified view of their balance and loan collection information across all their bank accounts. Lending companies can perform rule-based money transfer transactions, which helps them manage their treasury function effectively and earn yields on otherwise idle cash, helping them earn yields on their idle cash. TransBnk’s platform helps drive efficiencies across customer onboarding, disbursements, and collections operations of lending companies.

Provide instant access to loan underwriting and monitoring data

TransBnk’s platform is integrated with the core banking systems of large banks in India. The service can enable quick digital access to bank account information, which will improve turnaround time and provide seamless access to critical data essential for loan underwriting. Once a loan is disbursed, the lender can also monitor the loan and send collection reminders based on analyzing the information. Lending companies can also provide innovative loan products, such as daily repayment revenue-based loans, which have been tried by lending companies in the past but faced challenges to scale due to a lack of available infrastructure to assess the daily revenues of MSME customers and deduct loan repayment EMIs. TransBnk is building a banking infrastructure platform that we believe can transform loan underwriting and monitoring practices for lending companies as well as their customers.    

Leverage cashflow data on lending companies to digitize debt raise diligence and loan monitoring

The timely availability of debt capital is a critical raw material for NBFCs to scale. Debt investors (Banks or wholesale lenders) often have their due diligence processes which are time-consuming, non-standardized, and tedious. TransBnk aims to build a debt syndication marketplace that leverages the cash flow and collection data of lending companies available on its platform to streamline due diligence processes. On successful completion of the debt raise, TransBnk’s platform will enable debt investors to monitor their loans and help lending companies to regularly report their loan portfolio quality metrics to their investors through analytics reports and dashboards available on TransBnk’s platform. The debt syndication marketplace can potentially reduce due diligence timelines, enable regular loan monitoring, and provide the necessary transparency required to build trust and strengthen partnerships between debt investors and lending companies.

Within 20 months of launch, the company has forged partnerships with over 27 banks, extending more than 250 APIs, while working with 150 BFSI clients. The platform has supported over 6000 accounts, including escrows, and processed more than 75 million transactions. We believe that the company’s strong traction and glowing customer feedback are a testament to the strong customer value proposition. We are excited to partner with the founding team of TransBnk — Vaibhav Tambe (CEO), Sachin Gupta (CPO), Pulak Jain (CBO), and Lavian Kotian (CTO) — and have been impressed by the team’s deep domain expertise and strong execution capabilities. Accion Venture Lab is thrilled to support them in their journey to democratize access to transactions banking-related use cases for the financial services ecosystem in India and international markets as they aim to expand into the Middle East and further into Southeast Asia.