Revolutionizing Trade Finance: Roshan Shah’s VoloFin Takes the Lead in Fintech Factoring Solutions

StartupTalky presents Recap'23, a series of in-depth interviews where we engage with founders and industry leaders to explore their growth in 2023 and their predictions for the future.

The fintech industry, a dynamic blend of finance and technology, is revolutionizing traditional banking and financial services. Digital payments, blockchain, and robo-advisors are reshaping how we manage money. Startups in this sector focus on providing user-friendly interfaces, efficient transactions, and personalized financial solutions. The industry's rapid growth is fueled by innovations like peer-to-peer lending, contactless payments, and mobile banking.

India's fintech sector is set for substantial growth, with a projected $1.3 trillion Total Addressable Market by 2025. By 2030, Assets Under Management and Revenue are expected to reach $1 trillion and $200 billion, respectively. The payments landscape aims for impressive figures, targeting a transaction volume of $100 trillion and $50 billion in revenue by 2030.

In a recent Recap'23 interview, we at StartupTalky had the privilege of connecting with Roshan Shah, Co-founder and MD of VoloFin. We explored how VoloFin's innovation is revolutionizing the fintech industry by analyzing its development, hurdles, insights, and future strategies.

StartupTalky: What service does VoloFin provide? What was the motivation/vision with which you started?

Roshan Shah: We are an industry-first comprehensive Fintech platform, providing end-to-end solutions in the domains of factoring and supply chain financing. Traditionally, this business was done by banks. Even today, they continue to work but provide services only to large clients. Moreover, the cost of compliance and acquisition is extremely high for the banks. This has opened up opportunities for FinTechs to step into the picture. Some Fintech companies are operating in the lending business and are acting as a substitute for banks by providing financing to borrowers. However, at VoloFin, we are uniquely positioned as both a lender and a platform where even banks can participate in the factoring business, and we strive to provide complete end-to-end solutions. 

We started with a clear motivation to support the platform’s growth by providing the business with much-needed trade finance, which otherwise is a struggle for most of the organizations. Our idea of creating an end-to-end platform was to provide borrowers with quick and easy access to trade finance and at the same time allow banks to participate and grow their business. Our in-house proprietary tech platform is the core foundation of our platform, empowering us to play the role of both a lender and a platform, facilitating the banks to partner with us, and offering factoring as a ready solution. We offer factoring solutions delivered through a next-gen platform that digitally manages customer onboarding, KYC, credit, compliance, documentation, buyer approvals, transaction handling, disbursement, monitoring, collection, and credit insurance wrap. The lending frameworks are customized based on the lender’s credit guidelines and focus.

We have already onboarded various lenders on our platform, including banks and funds and are in the process of onboarding other banks, which will benefit significantly from partnering with us than doing it themselves. They will benefit in terms of cost, effort, efficiency, TAT, and having a solid credit framework provided by us. 

Our endeavour is to revolutionize lending across industries, from SMEs to large corporates. We further intend to spread awareness about factoring through different initiatives. We are also aiming to facilitate easy access to capital with a seamless blend of expertise and technology. We envision emerging as the most reliable, trusted, and largest Fintech for borrowers and banks in the times to come. 

StartupTalky: What new services have been added in the past year? What is/are the USP/s of VoloFin?

Roshan Shah: We are the industry’s first comprehensive invoice and supply chain financing platform, providing end-to-end solutions ranging from origination and collection to credit protection with insurance to platform lenders. Additionally, we provide an array of services for our clients (suppliers) and lenders, whether it is protecting them against buyer non-payment risk, providing them with collateral-free financing, and best-in-class in-house proprietary tech platform that offers full-stack supply chain solutions to lenders and banks; or ensuring quick supplier KYC and compliance through extensive integration, ability to underwrite buyers globally, and providing framework-based lending models with banks. 

We provide fast and easy access to funds, as well as non-recourse and collateral-free financing to our clients. We take the buyer default risk upon ourselves and provide funding to suppliers over and above their existing banking limits. This way, they are relieved from the payment-related hassle and can grow their business, take more orders, and increase their production capacity. 

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StartupTalky: How do you stay up-to-date on the latest trends and developments in the fintech industry?

Roshan Shah: Today, the market is highly competitive, and staying abreast with the latest industry trends and developments is critical to success. Keeping a tab on the recent government regulatory policies to adapt business as per the ongoing changes is the key to scaling the business. Additionally, monitoring the emerging technologies, products, or services in the industry keeps us on the right track. Actively participating in industry events and conferences is also essential, as they provide networking opportunities and insights about the latest emerging trends and technology. 

Staying in touch with industry peers and indulging in meaningful conversations with them enables us to understand the market better and build strategies for business growth. Moreover, a strong network of our channel/strategic partners keeps us abreast with market and industry updates as well. Staying connected with our clients also gives us good insights into industry developments.

StartupTalky: What were the most significant challenges VoloFin faced in the past year, and how did you overcome them?

Roshan Shah: In the past year, I feel the increase in the interest rates has posed a challenge to us in maintaining the rates we offer to the clients. While it was not easy, we focused on onboarding more lenders with lower costs of capital to ensure we could service our clients better without having them face the direct impact of increased rates. We sought an opportunity in this challenge, and it motivated us to strive for better client solutions, which was and is well appreciated by them as we stood by them in times they needed us most.

StartupTalky: What are the different strategies you use for marketing? Tell us about any growth hack that you pulled off.

Roshan Shah: In today’s social media-driven world, leveraging social networking platforms is a key component of the new-age marketing strategies. Hence, we also use the channels of content marketing and email marketing to reach our target audiences effectively. Additionally, knowledge sharing through emails and brochures with our existing clients and prospects helps build strong connections with them. We also try to participate in various industry events and seminars, and this strategy gives us visibility and helps us establish a strong brand reputation in the market. 

StartupTalky: What opportunities do you see for future growth in the fintech industry in India and the world? What kind of difference in market behavior have you seen between India and the world?

Roshan Shah: The Fintech industry in India has evolved and brought the potential of banking to the non-banking or under-banked population as well. The Digital India initiative with the government’s support, has changed the face of India on the global front. It provides easy financial facilities and services, along with growth opportunities. 

The inclusion of mobile wallets, digital payment gateways, blockchain, and platform-based transactions has opened avenues for emerging and established Fintech companies. Market behavior has transformed with mobile wallets and UPI-based payment gateways taking center stage in the financial landscape. This has pushed Fintech companies to provide financial solutions and easy credit line services to SMEs, MSMEs, and individual consumers. If we draw a comparison, the Indian government supports Fintech companies with a more stable and mature set of regulations than the other markets. 

We are witnessing increased client awareness in our Industry in India. The acceptance of companies using factoring is growing significantly. The companies are now using the product to their advantage, given it is quick, easy, collateral-free, and is an additional source of trade finance. Factoring is a big industry in most developed economies, but now the tech-driven trade finance FinTechs are gaining more traction in those markets.

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StartupTalky: What lessons did your team learn in the past year, and how will these inform your future plans and strategies?

Roshan Shah: We have a very strong and experienced in-house team that is well-informed and updated with industry trends, future expectations, etc. The real learning as such would be to continue to keep our focus on the clients and be solution-oriented, as not always the same product applies to all.

StartupTalky: How do you plan to expand the customers, service offerings, and team base in the future?

Roshan Shah: We have a robust in-house origination team, which we are continuing to expand. We have a mapped future talent pool base that we have planned to onboard in the coming months. 

We are already offering additional solutions to clients with our trade expertise, whereby certain transactions are trade-supported if not financed directly, like CAD payment terms, etc. We will be making a formal announcement of these solutions later in the year while we continue to execute some transactions currently.

StartupTalky: One tip that you would like to share with another service company founder?

Roshan Shah: Building a strong rapport with your stakeholders is crucial for your success. And to establish meaningful, long-lasting relationships, trust and transparency are the most important factors.

StartupTalky extends its gratitude to Mr. Roshan Shah for dedicating his valuable time and generously sharing his insights with all of us.

Explore more Recap'23 Interviews here.