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The payment gateway allows the merchants to process credit, debit, and other alternative online payments. Using a payment gateway can help to lessen the frequency and severity of credit card frauds within e-commerce or any other kind of business. This gateway for the payments acts as the go-between to make sure that customer data is encrypted and secure.
BillDesk is an Indian online payment gateway company based in Mumbai, India. The company provides payment solutions for customers in e-commerce, financial services, retail, and other sectors. Billdesk is one of the oldest payment gateways in India and is responsible for powering close to 60% of the online bill payments of the country.
Billdesk is currently being owned by PayU in a 4.7 billion dollar deal on August 31, 2021. PayU is a Netherlands-based company owned by Prosus, which has acquired Billdesk in one of the biggest deals that the Fintech industry of India has seen to date.
BillDesk - Company Highlights
| Startup Name | BillDesk |
|---|---|
| Headquarters | Mumbai, India |
| Industry | Finance |
| Founded | 2000 |
| Founder | M.N. Srinivasu, Ajay Kaushal and Karthik Ganapathy |
| CEO | M.N. Srinivasu |
| Valuation | $2.5 bn (September 2021) |
| Revenue | $285.39 mn (Rs 2,124.2 crore in FY21) |
| Total Funding | $241.4 mn (February 2022) |
| Area Served | India |
| Website | www.billdesk.com |
Billdesk - About and How it Works?
Billdesk - Industry
Billdesk - Founders and Team
Billdesk - Startup Story
Billdesk - Mission and Vision
Billdesk - Name, Tagline, Logo and its Meaning
Billdesk - Business and Revenue Model
Billdesk - Revenue and Growth
Billdesk - Funding and Investors
Billdesk - Competitors
Billdesk - Challenges Faced
Billdesk - Future Plans
Billdesk - About and How it Works?
Founded in 2000, by a team of ex-Arthur Andersen professionals, BillDesk, an Indian online payment gateway company continues to be at the forefront of the digital payments' evolution in India, creating Internet-based payments products that enable consumers to make payments online in a frictionless manner.
A product and service of about over 20 years of market leadership, BillDesk provides a reliable payment platform for enterprise-wide electronic payments and collections, related reconciliation and settlement operations, across multiple delivery channels, and using a wide range of payment methods.
Billdesk - Industry
The online payment gateway industry is a fast growing sector that is estimated to be growing with a CAGR of 9.18% over the estimated period between 2020-2026. The payment gateway market is expected to be growing at a CAGR of 19.3% between 2018 and 2025. The industry has last been valued at $446.9 mn in 2017 and is estimated to be growing to $1,708.1 mn in 2025.
Billdesk - Founders and Team
Billdesk was founded in 2000 by M.N. Srinivasu, Ajay Kaushal, and Karthik Ganapathy.
M.N. Srinivasu
Srinivasu, the Co-founder and Director of BillDesk, is a BCom Economics graduate who later completed a PGDM from IIM Ahmedabad. MN Srinivasu first started his professional career as the Manager of Agri Business Group of ITC Limited, he then switched to ITC Zeneca Limited, where he served the role of Financial Controller, but it continued only for a year after which he again switched to the Treasury (Financial Services) of ITC Limited, where he worked for a span of 4 years. He then went on to manage Business Consulting at Andersen. This continued for another year after which he co-founded Billdesk.
Ajay Kaushal
Ajay Kaushal is a Founder-Director of Billdesk, who started as the Head of Securities Research at SBI Capital Markets Limited. He then became the Manager at Arthur Andersen, after which Kaushal served as the Trustee at CAF India. He managed this job role for around 6 years before he decided to co-found Billdesk. Ajay Kaushal has a BTech in Electrical and Electronic Engineering and he topped it off with a PGGBM, MBA from IIM Lucknow.
Karthik Ganapathy
Karthik Ganapathy is an IIT Bombay and IIM Bangalore alumnus, who is regarded as the Chief Architect of the technology and operations that currently powers Billdesk. Bill desk founder before founding Billdesk, Ganapathy worked with Arthur Andersen.
The BillDesk team operates with an employee strength of somewhere between 501-1000 employees.
Billdesk - Startup Story
The founders of Billdesk, all three of them, were employed in the American accounting firm, Arthur Anderson. They quit their jobs to start their own company.
During that time, people had to stand in long queues to pay any bills, be it phone bills or electricity bills. This gave the founders an idea of a convenient payment platform, who then decided to do something to make this process simple and more convenient with the help of an online platform and this is how they started out with their company.
Billdesk - Mission and Vision
Billdesk's vision is to create a one-stop destination to make all payments.
"At BillDesk we are committed to this vision of implementing innovative solutions for simplifying payments and collections and translating the opportunities offered by the Internet into actual customer delight through efficient payment and collection services."
"We are on a mission to make payments accessible and easy for all through market leading solutions. Our greatest satisfaction is the success of our clients and their trust in our expertise, people and technology," says the company website.
Billdesk - Name, Tagline, Logo and its Meaning
Billdesk tagline says "All Your Payments. Single Location"
BillDesk's logo is the company's name written in block letters on a yellow background with white colour in the center which symbolizes a white colour light that becomes yellow after travelling through a distance. The colour yellow is associated with warmth, sunshine, and positivity.
PV Vyshnavi
Billdesk - Business and Revenue Model
Bill Desk is hailed as one among the oldest fintech companies that operates in a B2B business model. Billdesk started by connecting banks with any merchant or utility that had to accept payments from customers. An important feature of this business model was that it involved no end-consumer acquisition for BillDesk—the company would only take a cut from the merchant, bank, or utility for every transaction it facilitates.
The platform is used by many Indian organizations, companies, and banks. This includes companies in the industry of telecom, insurance, e-commerce, financial services, charity organizations, and many entertainment providers.
BillDesk provides a platform for various online and mobile payments that can be made through aggregator platforms in India.
"It is focused on the right market segments—banks, financial services, utilities, retail, ecommerce and government—and investors are optimistic about how big the business can become over time," Dheeraj Poddar (country head, India, at TA Associates Advisory) said.
Bill desk helps customers to organize, manage and make payments for any regular or recurring bills that they might have. Customers can also go back and review all their payments, in addition to receiving and paying through this gateway. This has provided the customers with a safer, quicker, and more efficient way of doing financial transactions.
BillDesk draws a major portion of its revenues from the fees that it charges on the processing of electronic transactions on its network. Some of its income comes from the prepaid accounts for recurring settlements (PINS and eTop up subscriptions) that it sells. This revenue stream is further followed by a loyalty reward point management service that BillDesk has. Furthermore, the company also draws in some income from its other ancilliary and advisory services.
Billdesk - Revenue and Growth
The company has been profitable for over a decade, though it does not reveal exact figures. For the year 2017-18, the startup saw a rise in profit (consolidated) to INR 149 crore from a profit amount of INR 138 crore. The revenue for the consolidated statements saw an increase from INR 899.7 crore to INR 1102.8 crore, which would be an increase of 22.6%. Along with revenue, even the total expenditure saw an increase from INR 772.7 crore to INR 943.7 crore.
Billdesk has previously counted its revenue from operations at Rs 1,804.7 crore in FY20, which grew by 17.7% to reach Rs 2,124.2 crore during FY21.
A major portion (75%) of the Billdesk revenues comes from the processing of its online transactions, which grew by 33.8% to during FY21 and reached Rs 1,593.12 from Rs 1,190.3 crore that it earned in FY20. Billdesk earns some frees from prepaid accounts for recurring settlements (PINS and eTop up subscriptions), which increased by 56.8% from Rs 158.5 crore in FY20 to reach Rs 248.5 crore during FY21. The loyalty points management program of Billdesk also earned the company 11.21% of its opearting revenue in FY21, which noted a decline of around 43.1%, from Rs 418.8 crore in FY20 to Rs 238.2 crore in FY21. Commission, ancillary and other advisory fees made up to Rs 44.4 cr.
Billdesk Revenue Breakdown
| Billdesk Revenue Streams | FY21 | FY20 |
|---|---|---|
| Electronic Transactions Processing Fees | Rs 1,593.12 cr | Rs 1,190.3 cr |
| Subscriptions from prepaid accounts (PINS and eTop up) | Rs 248.51 cr | Rs 158.5 cr |
| Loyalty reward points management service | Rs 238.2 cr | Rs 418.8 cr |
| Other Ancilliary Service Revenue (Commissions and Advisory Fees) | Rs 37.06 cr | Rs 44.4 cr |
The annual expenditure of Billdesk witnessed a 16.06% of growth to become Rs 1,880 crore during FY21 from Rs 1620 crore that it spent in FY20.
Billdesk Expenses Breakdown
| BillDesk Expenditure | FY21 | FY20 |
|---|---|---|
| Bank fees and service charges | Rs 1,613.03 cr | Rs 1,369.86 cr |
| Employee Benefits | Rs 152.52 cr | Rs 127.5 cr |
| Others | Rs 30.81 cr | Rs 78.65 cr |
| Cost of infrastructure (data communication, IT and server hosting | Rs 30.81 cr | Rs 28.58 cr |
| Legal and professional charges | Rs 17.52 cr | Rs 15.26 cr |
| EBITDA Margin | 16.62% | 16.79% |
In the present fiscal year (FY21) in review, BillDesk managed to earn a single rupee of revenue on the unit level by spending Rs 0.88. The recent growth of BillDesk in terms of its improvement of revenues can largely be accounted to the older, existing customers of the company that stayed with Billdesk throughout the years.
Billdesk has been acquired by Prosus-backed PayU on August 31, 2021. The latter acquired Billdesk in a deal worth $4.7 billion.
Shubham Kumar
Billdesk - Funding and Investors
Billdesk has raised a total of $241.4M in funding over 4 rounds. Their latest funding was raised on Nov 16, 2018, from a Corporate Round round. Billdesk is funded by 7 investors. Visa, General Atlantic and Temasek Holdings are the most recent investors.
In 2001, BillDesk received its first investment from SIDBI Venture Capital Ltd and Bank of Baroda. In 2006, Clearstone Venture Partners and State Bank of India jointly invested $7.5 million in the company. In 2012, US-based PE firm TA Associates made an undisclosed investment in BillDesk. In 2015, BillDesk received an investment of USD 200 million from General Atlantic and Temasek thereby giving the company a total valuation of $1 billion.
| Date | Round | Money | Lead Investor |
|---|---|---|---|
| Nov 16, 2018 | Corporate Round | $82.27M | Visa |
| Mar 15, 2016 | Secondary Market | $150M | General Atlantic |
| Apr 4, 2012 | Private Equity Round | - | TA Associates |
| Jun 22, 2006 | Venture Round | $7.5M | Clearstone Venture Partners, State Bank of India |
Billdesk - Competitors
BillDesk's competitors include -
- TechProcess Payment Services
- GooglePay
- Razorpay
- Airpay
- Oxigen
- PayUbiz
- Paytm
- Instamojo
- CCAvenue
- PhonePe
- Payworld
PV Vyshnavi
Billdesk - Challenges Faced
During the start of July 2020, BillDesk was looking at opportunities in the market so that it could sell its business. The company had tried selling their business in the past as well but were unable to do so. So this year they made another attempt.
Due to the intense competition that is present in this segment, it is only expected to increase. It is due to this competition in the digital payments segment that it is essential for companies to create an integrated payment system.
So, one of the obstacles was to wade off competition as the company is under low profile and a lot of other well-marketed small startups have been erupting here and there, for example, PayUmoney, Paytm, Citrus, and CC Avenue. Having been in the industry for almost two decades, Billdesk has successfully managed to add an edge to the company to wade off competition and also having a good clientele has definitely helped.
A recent obstacle faced by the company was when the Reserve Bank of India reduced the commission rates on almost all the online transactions which was a burden on the Payment Gateway company BillDesk. Yet they kept up their pace and were steadily delivering their services, thereby they were finally in the profit margin.
There have been stricter regulations regarding the payment gateways and aggregators (their commissions have been reduced). Also, the demand for such gateways has been on the rise continuously, and the need for a fully integrated system has been realized by BillDesk because it still remains just a payment gateway. Most investors are thus, also being pulled towards companies that offer more front-end services for their customers.
Being an older player in the billing industry, Billdesk has been through massive changes in the industry in the recent years and months but the company has managed it through with the older customer base that it had acquired throughout the years, who stuck with them. The next era of challenge for BillDesk would etch the company's performance to leverage the tremendous stability and momentum that it has shown.
Billdesk - Future Plans
Billdesk provides its service to almost all the cities in India. It plans on bringing in automation and artificial intelligence to have further smother transactional experience for the customers are to go on to acquire bigger brands and more customers. Domestic payment gateway BillDesk is again on the market to sell off after it was unsuccessfully sold two years ago by its promoters.
However, the BillDesk promoters are trying to sell off the whole company this time around, following a rapidly rising rivalry in the country’s digital payment processing space and booming e-commerce industry.
This was confirmed by two people with direct knowledge of BillDesk‘s plans, adding that BillDesk promoters and the company’s single largest shareholder, General Atlantic, have called at least eight investment bankers for talks on shortlisting a suitor.
Billdesk - FAQs
What is BillDesk?
BillDesk is an Indian online payment gateway company based in Mumbai, India.
Is BillDesk an Indian company?
Yes, BillDesk is an Indian online payment gateway company.
How does BillDesk make money?
BillDesk takes a commission from the merchants and utilities it serves and none from end-customers. The company has been profitable for over a decade, though it does not reveal exact figures.
How does BillDesk payment gateway work?
BillDesk is a one-stop online payment provider that helps customers organize, pay and manage their regular and ongoing bills. Customers can receive, review and pay all the bills they receive from different providers in one place with BillDesk.
Who is the CEO of Billdesk?
Srinivasu MN is the current CEO of Billdesk.
Billdesk - Conclusion
BillDesk is a one-stop online payment provider that helps customers organize, pay and manage their regular and ongoing bills. Customers can receive, review and pay all the bills they receive from different providers in one place with BillDesk. BillDesk takes a commission from the merchants and utilities it serves and none from the end customers. The company has been profitable for over a decade, though it does not reveal exact figures.