The Economic Times Startup Awards 2023: ETSA 2023 Social Enterprise winner | Financial security for the poor is the next step after financial inclusion: Seema Prem of Fia Global

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This is part of a series of interviews with the winners of The Economic Times Startup Awards 2023.

More than a decade ago, when Seema Prem returned to India armed with a degree from MIT and driven by the vision to offer financial services to the unbanked, little did she imagine the challenges that awaited her and Fia Global, the outfit she floated to realise her vision.

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When she got three districts of Burdwan, Purulia and Bankura in West Bengal to set up banking outlets on behalf of State Bank of India, she realised that financial inclusion was not about technology alone, but people’s confidence in Indian banks.

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“These people were impacted by the chit fund scams back then, so they would deposit money in the morning and withdraw in the evening due to the fear of losing their hard earned savings,” Prem told ET.

But things slowly changed, and eventually the government’s Jan Dhan Scheme took banking to the remote corners of the country. Fia Global and other players rode that wave.

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“We onboarded 10 million customers across 16 states within three years and then Jan Dhan happened and it jumped to 20 million accounts suddenly,” she said.

Fia Global bagged the Social Enterprise Award in the 2023 ET Startup Awards, which were announced recently.

While the policy push helped expand business, low margins and high operational costs made business viability a major challenge for Prem. These are not the type of businesses that typically attract venture capital; but without external funding, running and expanding operations sustainably was becoming a challenge.

It was then that Fia Global got a timely grant of Rs 1 crore each from the World Bank and the Millennium Alliance. The funding infusion helped the business find its footing. Over the last few years, Fia Global has consistently increased its revenue and profits year on year.

“Today our internal accruals can power our fraud checks, technology innovations and our daily business operations, but to enter into new business lines we will need fresh equity money,” Prem told ET.

What the pandemic taught the leadership at Fia Global is that basic banking services do not offer financial security to poor Indians. They need services beyond payments and savings, such as insurance, income generation loans and investment opportunities.

Armed with a lending licence, Prem intends to expand Fia Global into new business operations such as offering income generation loans, Insurance to offer protection against natural disasters, crop failures and such.

“We look at the savings and income level of our customers and nudge them accordingly—the idea is to sell more complex financial products now,” she said.

Fia Global has more than 82 million customers today, and Prem wants that number to touch 100 million by 2025. Leaning on the company’s bouquet of financial services, Prem now intends to go beyond offering basic banking services.

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