We recently had the opportunity to catch up with Founder and CEO of SOCASH, Hari Sivan, for his thoughts on things. For the uninitiated, SOCASH’s mobile app turns shops into ATM alternatives, allowing users to withdraw cash or make loan applications at the checkout.
ABR: Firstly, thank you for the opportunity to talk with you. At ABR, we are always looking for C-level executives who can lay it all out for us. So how has 2020 been so far?
HS: We had a very good Q1 in 2020 with revenues hitting a record. When markets in ASEAN went into lockdown in Q2, our business volumes were hit. We expect to recover progressively once the economy and employment generation picks up leading to growth in consumption.
ABR: How is the company coping with the trials and tribulations of the global economy, supply chain disruptions and the new normal as a result of the Covid-19 pandemic?
HS: Every risk event or crisis typically presents new opportunities. In our case, there was a surge in demand from banks looking for alternatives to ATMs, and retailers looking for efficient cash processing. While SOCASH is mostly unaffected by supply chain disruptions, the universal drop in consumption has resulted in a fall in revenues, which has created idle capacity and a decline in profitability. It has forced us to focus on risk management and revenue diversification.
ABR: Is all of this taking a toll on the operational side of things? Has there been a re-imagined approach to the way the business is being run now?
HS: Social distancing and the closure of businesses and the economy have indeed affected our operations, but we are seeing green shoots across the markets that we operate in. There is a significant emphasis on optimal costs and short term revenue goals leading to better management of capital. Our fixed costs are down by a significant amount, which should serve as the new baseline for our operating model.
ABR: It was reported last year that SOCASH raised US$6 million (S$8.2 million) in Series B funding, how are things progressing on the funding front since? What’s next?
HS: The funds are currently used to build our network across Asia, which now spans over 16,000 retailers spread across Singapore, Indonesia and Malaysia that are willing to offer cash, payments and basic banking services. We have added new senior hires to manage this growth phase and drive business targets. Additionally, significant investments have been made to the product to scale quickly, in order to support the growth in the region.
ABR: Essentially, SOCASH’s mobile app turns shops into ATM alternatives, allowing users to withdraw cash or make loan applications at the checkout. This converts the retail outlets into “virtual branches” in its network. Could you tell us more about your company’s solutions and how it impacts the APAC region?
HS: As the next billion in Asia rises above poverty and drives consumption, they are demand for essential banking services will increase. Given the scale and distribution challenges inherent to Asia, the old banking (ATM and physical branches) model is cracking under the surge in demand. Our marketplace approach to banking offers a smarter alternative, offering diminishing costs and efficiency. Imagine the possibilities when small retailers can provide financial services just like they do for telco and more, representing a self-scaling distribution model akin to e-commerce, generating massive efficiencies.
Be sure to check out Part 2 of this interview with Hari Sivan soon!
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Anil started his career in journalism all the way back in 2003. After traversing the sphere of editorial, corporate communications and advertising, he has now come full circle and is back in the world of journalism. He believes in the power of the written word, and its ability to enthrall, delight and inform the reader.
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