How is Fintech 🏦 giant EbixCash profitable?
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EbixCash recorded revenue of ₹2,374Cr in FY2023 with a profit of ₹748Cr! That’s a 32% profit margin! This makes them one of the only fintech startups that’s profitable in India (Event Paytm is not profitable yet) What are they doing and how are they generating such profit?
How was EbixCash born 🐣?
EBIX Inc. (NASDAQ listed company with $1.14Bn in revenue) acquired ItzCash (Founded in 2007) in 2017 for ₹1000Cr and renamed it as EbixCash.
What is the business 🤝 of EbixCash?
EbixCash operates mainly in the categories of Payment solutions, financial products, travel, and BPO services.
May small and big startups In India are operating in each of the above segments but a handful of them are profitable, what is EbixCash doing differently to operate at this scale and stay profitable?
Let’s Decode!
1/Phygital strategy that dominates the $7Bn Inward remittance business in India 🇮🇳
All our friends who study or work abroad use platforms like Western Union, TransFast, and Ria and EbixCash is their partner in India who facilitates all these payments! They operate 650,000 physical or digital (phygital) outlets that hand out the cash sent by our friends from abroad. EbixCash dominates this space with $7Bn in GMV and a 70% market share!
2/Dominating the corporate prepaid card 💳 business with GMV of $2Bn
EbixCash is one of the biggest players in the corporate prepaid and gift card business thanks to their acquisition of ItzCash which started this in 2006. This business alone generates ₹800Cr (1/3 of total) revenue to EbixCash. It’s again a B2B business that works with banks and corporates to issue these cards.
3/Operating via.com for B2B Travel API services
EbixCash operates via.com which is a B2B company that provides travel API to access real time flights and hotel inventory to travel agents and corporates. The secret sauce of via.com is their 1 lakh travel agent customers who drive $1bn GMV (~5% market share)
4/Railway booking partnership with IRCTC
EbixCash is the largest principal agent for IRCTC Railway Ticket booking, authorized to issue agent logins for ticket bookings. This creates a monopoly for EbixCash in it’s B2B travel solutions business. Travel agents contribute 55% of bookings to IRCTC.
5/Creation of a one-stop travel agent stack
With Forex, Prepaid cards and Travel API EbixCash has created a beautiful travel agent stack to run their business end to end which has a high cross-selling potential.
6/Wealth, Fund, Loan products for Banks, MFs, and lending companies
EbixCash operates a B2B financial SaaS product MoneyWare used to manage wealth, funds, and loans of retail customers by SBI, Kotak, Union Banks, Motilal, Edleweiss MFs, and Fullerton again with significant market share in this domain.
Similar to EbixCash integrated stack, we have Paytm, Razorpay who are building end-to-end solutions and it will be exciting to see more fintech giants in India 🇮🇳.